Construction Change Order Template (2026) — and How to Actually Get Paid for One

The change order is the most expensive piece of paper you’ll ever skip. Someone asks for something extra, you say sure, you do the work, and four months later you’re explaining to a lawyer why you thought a conversation in a driveway was a contract.

This guide gives you a template built on the industry-standard structure, the real numbers on how often change orders happen and what they cost, and the specific failure modes that leave contractors unpaid.

Not legal advice. Contract law varies by state; have an attorney review your forms.

The three things a change order must state

AIA A201-2017 § 7.2.1 defines a change order as a written instrument signed by the owner, contractor, and architect stating their agreement on:

1. The change in the Work — scope
2. The amount of the adjustment, if any, in the Contract Sum — price
3. The extent of the adjustment, if any, in the Contract Time — time

Scope, price, time. That’s the whole backbone, and it comes from the document the industry has standardized on.

Source: AIA A201-2017, General Conditions of the Contract for Construction — § 7.2.1 defines the change order; § 7.1.5 covers electronic signatures

Worth knowing: § 7.1.5 confirms electronic signatures are acceptable on change orders. There’s no reason to be driving paper around.

The template

What the data actually says

Most articles on this topic repeat that change orders run 10–15% of contract value, usually credited vaguely to “Dodge Data.” We couldn’t find a primary study supporting it, and a much larger dataset contradicts it.

AIA Contract Documents analyzed 892,457 change orders across 18,229 completed US projects over ten years, all 50 states, 22 building types. Here’s what it found.

Source: AIA Contract Documents, “The Truth About Change Orders” (2023) — 892,457 change orders and 243,120 substantial completion certifications, narrowed to an analytic dataset of 18,229 completed projects

How many change orders per project:

Project value	Average	Typical range
$0–$500k	1.70	1–3
$500k–$1M	2.45	1–5
$1M–$5M	3.73	1–8
$5M–$10M	5.88	1–13
$10M–$50M	7.93	1–17
Over $50M	11.29	1–27

38% of completed projects have exactly one change order over the entire job. Another 20% have exactly two.

What they cost:

Project value	Average cost change	Typical range
$0–$500k	+3.20%	−8.02% to +15.88%
$500k–$1M	+4.36%	−4.32% to +13.95%
$1M–$5M	+5.04%	−2.39% to +15.19%
Over $50M	+4.60%	−0.11% to +14.99%

The average is 3–5%, not 10–15%. For residential work, the relevant row is the first one: about 1.7 change orders averaging +3.2% of contract value. Note the ranges go negative — a meaningful share of change orders are credits.

Schedule impact is smaller than anyone expects: average duration change is 1.07% to 1.13% across every project size.

The counterintuitive finding: AIA concludes there is “little relationship between the number of change orders and their effect on increases in cost or duration.” More change orders don’t mean a worse project. What matters is when they arrive — “the later a change order is issued in the project lifecycle, the less alternatives an owner has in responding to the change.”

Most change orders land in the final half of a project. That’s the expensive half, because by then nobody has options.

Why verbal change orders are a lottery

You’ll read that verbal change orders are never enforceable. That’s not quite true, and the real picture is more useful.

Courts do sometimes enforce oral changes despite “no oral modification” clauses. Parties can waive such a clause through conduct — an owner who knowingly watches you perform extra work may be found to have waived the writing requirement. Apparent authority can also bind an owner: in Patriot Construction v. VK Electrical Services, a project manager who lacked actual authority to modify the contract had apparent authority, and the subcontractor got paid despite skipping the written procedure.

But note what those cases have in common: they’re litigated. The honest framing isn’t “you’ll never get paid.” It’s that a written change order gets you paid in 30 days, and a verbal one might get you paid after a lawyer costs you more than the change was worth.

Some states remove the ambiguity entirely. Pennsylvania’s HICPA requires that contract specifications not be changed without a written change order signed by both homeowner and contractor. Connecticut § 20-429 makes a home improvement contract unenforceable against an owner unless it’s in writing and signed — and it must contain the entire agreement.

Source: Pennsylvania Home Improvement Consumer Protection Act, 73 P.S. § 517.7 — Act 132 of 2008, via the PA Attorney General

Source: Connecticut General Statutes § 20-429 — home improvement contract requirements

Pricing a change order

AIA A201 § 7.3.8 allows overhead and profit on change orders, computed on the net increase in the contract sum. Where a change adds some work and credits other work, O&P is figured on the net.

Two things contractors get wrong here.

A201 does not set a markup percentage. The method is left to the supplementary conditions and is negotiable. The commonly cited market convention is 15–25% combined overhead and profit, but that’s practice, not an AIA rule — and it means it’s negotiable in your favor if you raise it before signing the base contract.

Change order work deserves a higher markup than base contract work. Not because you’re opportunistic, because it costs more per dollar: it’s small-batch, out of sequence, unbid, it disrupts planned productivity, it carries disproportionate admin cost, and it usually happens under schedule pressure. AIA’s own data — most changes arriving in the final half — supports exactly this. (Nobody has published a study quantifying the right premium, so set yours from your own job costing.)

On deductive changes, the owner generally isn’t entitled to a credit for your overhead and profit.

Lump sum or T&M? Lump sum when the scope is knowable. T&M with a not-to-exceed cap when it isn’t — opening a wall, chasing a leak, anything where the answer is behind something. The AIA structure has a parallel: a Construction Change Directive is the “proceed now, price it later” instrument, requiring only the owner and architect.

Hidden conditions: exclude them, don’t absorb them

Renovation change orders come disproportionately from what’s behind the drywall. The costs are real:

Condition	Typical cost
Asbestos testing	$250–$800
Asbestos removal, interior	$5–$20/sq ft
Asbestos removal, exterior	$50–$150/sq ft
Asbestos encapsulation	$2–$6/sq ft
Lead inspection	$300–$700
Lead risk assessment	$500–$1,500
Lead paint removal	$6–$17/sq ft
Water damage repair	$1,361–$6,270
Foundation repair	$2,218–$8,112

Ranges from consumer cost aggregators (Angi, HomeGuide, Fixr, This Old House); treat as directional.

Three protections, all written before the job starts:

1. A concealed conditions clause stating what happens on discovery.
2. An exclusions list naming hazmat abatement, code upgrades, and structural repair as outside the base price. Lead RRP rules make disturbing lead paint in pre-1978 housing a regulated activity — that’s a scope you can’t quietly absorb.
3. A stop-work-and-price trigger. You stop, document, price, get a signature, then continue.

A 10–15% contingency allowance for unforeseen conditions is standard practice on renovation work. It’s not padding; it’s the difference between a planned conversation and an emergency one.

Seven ways contractors don’t get paid for change orders

1. Starting on a verbal go-ahead when the contract requires written authorization.
2. Taking direction from someone who can’t bind the owner — an architect, a PM, a spouse. Apparent authority sometimes saves you, but that’s a lawsuit, not a plan.
3. Missing the contractual notice deadline. Most contracts impose three hurdles: written notice of the event, a written estimate of cost and time, and compliance with a dispute process. Miss any one and the claim can die on procedure.
4. Omitting the time adjustment, forfeiting schedule relief and inviting liquidated damages.
5. Raising it after final payment. Many contracts bar adjustments asserted for the first time after final payment.
6. Signing a broad lien waiver that covers unpaid change order work.
7. Rolling changes into the final invoice instead of pricing each one contemporaneously. This is the most common and the most fatal — it severs the link between the change and the owner’s decision to approve it, and it turns your invoice into a surprise.

FAQ

What should a change order include?

Scope, price, and time — the three elements AIA A201 § 7.2.1 requires. Plus project and job site details, a sequential change order number, the reason for the change, an itemized cost breakdown, the adjustment to the contract sum showing old and new totals, days added to the contract time, and signatures from both owner and contractor.

Are verbal change orders legally binding?

Sometimes, which is the problem. Courts have enforced oral changes where an owner waived a written-change requirement through conduct, or where a project manager had apparent authority. But those outcomes come from litigation. Several states, including Pennsylvania and Connecticut, have statutes requiring written signed changes on home improvement work.

What percentage of a contract do change orders typically add?

AIA’s analysis of 892,457 change orders across 18,229 projects found average cost increases of 3.2% on projects under $500k and 4–5% on larger projects. The widely repeated “10–15%” figure has no traceable primary source and is contradicted by this much larger dataset.

How much markup can I charge on a change order?

AIA A201 permits overhead and profit on the net increase in contract sum but does not set a percentage — it’s negotiable and belongs in your contract’s supplementary conditions. Market convention is 15–25% combined overhead and profit. A higher rate than your base contract markup is defensible because change work is out of sequence, unbid, and disruptive.

How many change orders is normal on a residential project?

For projects under $500,000, the average is 1.70 change orders, with a typical range of 1 to 3. About 38% of all completed projects have exactly one change order over the entire job.

Should change orders be lump sum or time and materials?

Lump sum when the scope is knowable, since it gives both parties certainty. Time and materials with a not-to-exceed cap when it isn’t — investigating a leak, opening a wall, or anything where the real scope is hidden. The cap is what makes T&M acceptable to an owner.

The short version

Write down scope, price, and time — especially time, which is the one everyone skips. Get a signature before the work starts, because “you might win in court” is not a business model. Price changes at a higher markup than base contract work, since out-of-sequence work genuinely costs more. And exclude hidden conditions in the original contract, because asbestos at $20 a square foot is not a line you want to discover mid-job.

The reassuring part, from real data: the typical residential job has fewer than two change orders adding about 3% to the contract. Change orders aren’t a sign the job is going badly. Handling them verbally is.

SnapScope prices scope changes from new job site photos, so the paperwork goes out while you’re still standing in the room.

Related: what to include in a construction estimate, contractor deposits and payment schedules, and markup vs margin.