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Contract Analyzer Pipeline™ — Step 2

Risk Scanner

Every risk identified, severity-rated, and paired with a worst-case scenario and dollar exposure — so you know exactly what to fix before you sign.

Demo: $55K Contractor Bid — Risk Report

See the full Risk Scanner output for a kitchen and bath renovation contractor bid.

Overall Risk Score
6/10

Multiple risks around change order ambiguity, missing delay penalties, and unfavorable arbitration terms. No single deal-breaker, but 3 items need attention before signing.

Low Medium High Critical
Critical

Verbal change orders are binding (§6)

Dollar Exposure
$5,000 – $15,000
Worst Case
Contractor adds work verbally, claims you approved it, and bills for extras you never agreed to in writing.
Recommendation: Strike verbal approval language. Require written sign-off with a cost estimate before any change begins.
High

No delay penalty cap (§11)

Dollar Exposure
$3,000 – $8,000
Worst Case
Project stretches 3+ months past deadline with no recourse. You pay rent/mortgage on a property you can’t use.
Recommendation: Add a delay penalty: $100/day after the agreed completion date, capped at 10% of contract value.
High

Arbitration in contractor’s county (§16)

Dollar Exposure
$2,000 – $5,000
Worst Case
You must travel to contest a dispute on their turf, raising your legal costs and lowering your odds.
Recommendation: Change arbitration to mutual agreement on venue, or default to the property’s county.
Medium

Not named as additional insured (§18)

Dollar Exposure
$10,000 – $50,000
Worst Case
Subcontractor injury lawsuit names you as property owner. Your homeowner policy may not cover it.
Recommendation: Require contractor to name you as additional insured on their general liability policy before work begins.
Medium

Warranty excludes materials (§14)

Dollar Exposure
$1,500 – $4,000
Worst Case
Countertop cracks at month 8. Contractor says it is a material defect and walks away. Manufacturer warranty has a 90-day claim window you missed.
Recommendation: Extend warranty to cover both labor and materials, or require contractor to file manufacturer warranty claims on your behalf.
Medium

No lien release timeline (§9)

Dollar Exposure
$2,000 – $6,000
Worst Case
Subcontractor files a lien 6 months later because contractor never collected the waiver. You pay twice.
Recommendation: Require signed lien releases from all subcontractors before each progress payment is released.
Low

Payment schedule front-loaded (§4)

Dollar Exposure
$0 – $2,000
Worst Case
25% at signing means $13,750 out the door before any work starts. Industry standard is 10–15% deposit.
Recommendation: Negotiate deposit down to 10–15% and tie remaining payments to milestone completion.
Low

Permit responsibility unclear (§7)

Dollar Exposure
$500 – $2,000
Worst Case
Neither party explicitly owns permits. If missed, you face fines or must redo unpermitted work.
Recommendation: Add a clause assigning permit responsibility to the contractor, with proof of filing required before work begins.

Missing Protections (Omissions)

What the contract doesn’t say can be just as dangerous as what it does.

No maximum project duration or completion deadline

Without a hard deadline, the project can drag indefinitely with no contractual recourse.

No mechanic’s lien protection for the owner

Subcontractors can file liens against your property if the GC doesn’t pay them — even after you paid the GC in full.

No requirement for contractor to carry workers’ comp

An uninsured worker injury on your property could expose you to a lawsuit and six-figure liability.

Top 3 Fixes Before Signing

The highest-impact changes to make — ranked by dollar exposure.

1
Strike the verbal change order clause

Require written sign-off with a cost estimate before any change begins. This one clause can add $5,000–$15,000 in unauthorized charges.

2
Add a delay penalty

$100/day after the agreed completion date, capped at 10% of contract value. Without it, the project can drag for months with no recourse.

3
Change arbitration to mutual agreement on venue

Or default to your county. Traveling to the contractor’s county adds $2,000–$5,000 in legal costs and tilts the playing field.

How the Risk Scanner Works

Step 2 of the Contract Analyzer Pipeline™.

1

Feed In the Contract

Copy the Risk Scanner prompt and paste your contract at the placeholder. The AI reads every clause and every omission.

2

Get a Severity-Rated Risk Table

Each risk receives a severity rating (Low, Medium, High, Critical), a dollar exposure range, and a worst-case scenario in plain English.

3

Act on the Top 3 Fixes

The scanner ends with the three highest-impact changes to make before signing — ranked by dollar exposure and ready for your attorney call.

Explore More Features

See everything Contract Review Analyzer has to offer.

Plain-English Breakdown

Every clause translated into plain English with standard/worth-noting/unusual ratings and a TL;DR summary.

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Negotiation Playbook

Top 10 asks with paste-ready counter-language, fallback positions, and walk-away thresholds.

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AI Contract Review Pipeline

Analyze any REI contract with a 5-step AI pipeline: plain English, risks, obligations, negotiation playbook, and executive brief.

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Know Every Risk Before You Sign

Severity-rated risks, dollar exposure, worst-case scenarios, and a Top 3 fix list — from any REI contract.

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