Taken from : CSLB.CA.Gov
Get it in writing. Since a written contract protects both you and the contractor, all agreements should be put in writing. It should be as specific as possible regarding all materials to be used, such as the quality, quantity, weight, color, size, or brand name as it may apply. For example, the contract should read “install oak kitchen cabinets, manufactured by Company XYZ, model 01381A, as per the plan,” not just “install kitchen cabinets.”
Don’t sign anything until you understand the contract and agree to the terms. Anything you sign as authorization to move forward with the project could become the contract. Ask questions until you understand and agree to all the terms before signing. You also may wish to review the proposed contract with an attorney.
Make sure the contract includes everything that is agreed to, up to and including complete cleanup and removal of debris and materials, along with special requests like saving lumber for firewood or saving certain materials or appliances. Also give instructions regarding pets, children or areas where materials may not be stored.
Never sign a blank or partially blank contract. Once you sign, both you and the contractor are bound by everything set down in the contract. Make sure to get a copy of the contract, and keep it for your records.
Always update your contract. Even after you have signed the contract and the work already has begun, you may want to make some changes. If you have added or subtracted work, substituted materials or equipment, changed the completion date, etc., make sure to note it in writing on a “change order,” and include any price changes. After a change order is signed, it becomes part of the written contract.
For swimming pools, make sure that you receive a Checklist for Homeowners – Swimming Pool. One must be provided in the contract, as well as a plan and scale drawing showing the shape, size dimensions, and construction and equipment specifications. You may wish to refer to Swimming Pool Construction for more information.
Make sure your cancellation is in writing. You may cancel within three (3) days of signing a contract, but it must be mailed before midnight of the third day.
Make sure the financial terms are clear. The contract should include the total price, when payments will be made, and whether there is a cancellation penalty. You should expect to make a down payment on any home improvement job. That down payment should never exceed 10 percent of the contract price or $1,000, whichever is less.