Building Contracts for Homeowners: JCT, FMB & When You Need One

Your builder hands you a two-page quote. You sign the bottom. Work starts. Six weeks in, they want £4,000 more for something they say was "always going to be extra." You look at the quote. It doesn't mention it. Neither of you knows where you stand.

In short: A detailed quote protects you on price. A formal building contract protects you on everything else - delays, variations, defects, disputes, and payment terms. For projects over £20,000, the £30–£50 cost of a standard contract template is the cheapest insurance you'll buy.

This is what contracts are for. Not because you expect things to go wrong, but because when they do - and in construction, they often do - you need a document that tells both sides what happens next.

When do you need one?

There's no legal requirement to use a formal building contract. A verbal agreement is technically a contract. So is a signed quote. But neither gives you much to work with if things go sideways.

Here's a practical guide:

The threshold isn't just about money. Complexity matters too. A £15,000 bathroom refit in a straightforward layout is lower risk than a £15,000 structural alteration involving building regulations and party walls. If there are multiple trades, structural changes, or regulatory approvals involved, use a contract regardless of cost.

What a quote doesn't cover

A good quote tells you what work will be done and how much it will cost. That's important, but it doesn't address:

• What happens if the builder is late? Is there a completion date? Are there consequences for delay?
• How are variations handled? If additional work is needed, who agrees it and at what price?
• What about defects? If something's wrong after practical completion, how long does the builder have to fix it?
• When do you pay? Is it staged payments, or lump sums at milestones?
• What if there's a dispute? Who decides, and how?
• Can either side walk away? Under what circumstances, and what happens to money already paid?

A formal contract covers all of this. A quote on its own doesn't. For more on what a quote should contain, see our guide on what a builder's quote should include.

The main contract options

JCT Minor Works Building Contract (MW)

The JCT (Joint Contracts Tribunal) Minor Works contract is the industry standard for residential projects. It's been used for decades and has been tested extensively in court, which means its clauses are well understood.

Best for: Projects where an architect or contract administrator is involved. Extensions, loft conversions, new builds - anything over £20,000 where you want comprehensive protection.

What it covers:

• Contract sum and payment stages
• Completion date and extension of time (for delays outside the builder's control)
• Variations - how changes are instructed and valued
• Defects liability period (usually 6 months after completion)
• Insurance requirements
• Dispute resolution (adjudication, then arbitration or court)
• Termination - when either party can end the contract

Cost: £30–£50 for the template from JCT's website. You fill in the blanks - contract sum, completion date, payment stages, defects period. You don't need a solicitor, although one can review it if you prefer.

The homeowner version: JCT also publishes a "Building Contract for a Home Owner/Occupier" (HO), which is simpler and designed for projects where the homeowner manages the builder directly (no architect). It's cheaper and less intimidating than the full Minor Works contract.

FMB (Federation of Master Builders) Contract

The FMB contract is designed specifically for homeowner-builder projects. It's simpler than JCT and written in plain English rather than construction-industry legalese.

Best for: Smaller to medium projects (£10,000–£50,000) where you're dealing directly with the builder and don't have an architect managing the works.

What it covers:

• Price and payment schedule
• Start and completion dates
• What happens with extras and variations
• Defects period
• Basic dispute resolution

Cost: Free to download if you use an FMB-registered builder. Otherwise around £20.

Limitations: Less comprehensive than JCT. It doesn't cover complex scenarios as thoroughly - things like extensions of time, liquidated damages for delay, or detailed insurance provisions. For straightforward projects, that's fine. For anything involving structural work or multiple phases, JCT is more robust.

RIBA Domestic Building Contract

The RIBA (Royal Institute of British Architects) contract sits between JCT and FMB in complexity. It's a good option if you're working with an architect who'll administer the contract.

Best for: Architect-led projects where the RIBA contract aligns with the architect's standard working practices.

Cost: Around £40 from the RIBA Bookshop.

Key clauses explained

Whatever contract you use, these are the clauses that matter most:

Payment terms

The contract should set out exactly when you pay and how much. Typical structures:

• Staged payments - fixed amounts at defined milestones (foundations complete, walls up, roof on, practical completion)
• Monthly valuations - the builder submits a monthly account of work done, and you pay within 14–21 days
• Retention - you hold back a percentage (usually 2.5–5%) until the defects period ends. This gives the builder an incentive to come back and fix snags

Never agree to large upfront payments. A 10% deposit or first-stage payment is normal. Anything over 25% before work starts should raise questions. See our guide on builder deposits for more on this.

Variations

Changes happen on every project. You decide you want a different window. The builder discovers the subfloor needs replacing. The key is how these changes are handled.

A good contract requires variations to be:

• Agreed in writing before the work is done
• Priced or valued before you commit
• Signed off by both parties

Without this, you end up arguing about what was "extra" and what was always included. That's the conversation nobody wants to have when you've already paid £30,000.

Completion date and delays

The contract should include a target completion date. Not a vague "approximately 12 weeks" - an actual date.

It should also cover what happens if the builder is late. Options include:

• Extension of time - if the delay is caused by something outside the builder's control (bad weather, supply chain issues, your own changes), they get extra time
• Liquidated damages - a pre-agreed daily or weekly amount the builder pays you for unjustified delay. Typically £50–£200 per week, depending on project size

Defects liability period

After practical completion, the builder should have a defined period (usually 6 months) to return and fix any defects at their own cost. This is separate from snagging - it covers issues that emerge after you've been using the finished space.

If there's no defects clause, the builder has no contractual obligation to come back once they've been paid in full. Good luck getting them to fix that crack in the plaster six months later.

Dispute resolution

Every contract should include a mechanism for resolving disagreements. The typical hierarchy is:

1. Negotiation - talk it out directly
2. Mediation - a neutral third party helps you reach agreement
3. Adjudication - a construction adjudicator makes a binding decision (required by law under the Housing Grants, Construction and Regeneration Act 1996 for contracts over a certain value)
4. Court - last resort

Having this written down means both sides know the process. Without it, the only option is court - which is slow, expensive, and unpredictable.

How to use a building contract

1. Choose your contract - JCT HO for architect-managed, FMB for direct relationships, or JCT MW for larger projects
2. Fill in the details - contract sum, completion date, payment stages, defects period, insurance requirements
3. Attach the specification - the contract refers to a scope of works. This is your detailed quote or specification document. The contract sets the terms; the spec defines the work
4. Both parties sign - you and the builder each keep a signed copy
5. Use it - if a variation comes up, follow the contract procedure. If there's a delay, record it. The contract only works if you actually refer to it

Common objections (and why they're wrong)

"It's only a small job." Even small jobs go wrong. A £12,000 bathroom refit that turns into a £16,000 dispute is worth spending £30 on a contract.

"My builder won't sign a contract." Any professional builder should be comfortable with a standard contract. If they refuse, ask why. A builder who won't commit to a completion date, a defects period, or a clear payment schedule is telling you something about how they operate.

"Contracts make the relationship adversarial." The opposite is true. A clear contract means fewer misunderstandings. Both sides know what's expected. The conversations about variations and payments are easier, not harder, when there's a framework.

"I trust my builder." Trust is good. A contract doesn't replace trust - it supplements it. You trust your builder to do good work. The contract handles the situations that trust alone can't fix: what if they get ill, what if materials are delayed, what if you change your mind about the layout.

The cost of not having one

No contract means:

• No agreed completion date (so no recourse for delays)
• No formal variation process (so disputes about extras)
• No defects period (so no obligation to fix problems)
• No dispute resolution mechanism (so straight to court)

The average small claims court filing fee is £115–£455 depending on the amount. Solicitor letters start at £200+. A JCT contract costs £35.

The maths is straightforward.

Got a quote? Make sure it's contract-ready

A building contract works alongside your quote - not instead of it. The quote defines the work and the price; the contract defines the terms. Upload your quote to MyBuildAlly and we'll check whether it's detailed enough to form the basis of a formal contract, or whether you need to go back and fill in the gaps.

Sources

• JCT Contracts - official templates for building contracts
• Federation of Master Builders - FMB contract templates and builder search
• RIBA Contracts - RIBA domestic building contract
• GOV.UK: Housing Grants, Construction and Regeneration Act 1996 - legislation covering construction contract payment and adjudication
• Citizens Advice: Building work on your home - consumer guidance on building contracts