An HOA can receive three bids and still lack a fair comparison. The scope, materials, exclusions, insurance, and contract terms may differ enough to change the true cost and risk of the project.
The HOA Contractor and Service Provider Due Diligence Checklist gives boards a practical way to review a proposed vendor before signing. It is designed for significant maintenance, repairs, replacement, construction, professional services, and other substantial work.
The checklist helps the board review:
- The scope of work and any bidding or approval requirements.
- The vendor’s business identity, required licenses, qualifications, references, and history.
- Insurance coverage appropriate for the type and size of the project.
- Whether competing proposals cover the same work and whether a low bid leaves out important costs.
- Referral fees, personal relationships, and other potential conflicts of interest.
- The information directors need before discussing and approving a contract.
- Contract terms involving price, payments, warranties, liability, termination, and dispute resolution.
- Who may approve change orders and how additional costs are documented.
- Who will monitor the work and confirm completion before final payment.
- The records the association should keep in its project file.
The 20 sections include questions to ask references, factors to compare across bids, contract provisions to examine, and a final board confirmation before a significant agreement is approved.
Use the checklist with your community manager and, when the project warrants it, your engineer, insurance professional, or association attorney. The level of review should fit the project’s size, complexity, and risk.
Ideal for: HOA board members, directors, management committees, and community association managers preparing a significant vendor decision.
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Educational notice: This checklist provides general educational information. Licensing, bidding, board approval, and contract requirements vary by state and locality. An association’s governing documents may add requirements. Consult qualified local professionals about significant projects and contracts.
