What Belongs in an Interior Design Letter Agreement
A letter agreement has one job: to answer, in writing, every question you'll otherwise have to negotiate while you're angry. Scope, revisions, timing, money, and how it ends.
Most design agreements we read are competent on fee and silent on everything that actually causes disputes. Below is what belongs in one, and the four omissions that cost firms the most.
The twelve clauses
1. Parties and project. Legal names, property address, and — this one gets skipped — who is authorized to approve. On a couple's project, name the decision-maker. Two clients with equal authority and different opinions is a schedule problem waiting to happen.
2. Scope of services, by phase. Programming, schematic, design development, documentation, procurement, construction administration. State which phases are included. A phase not named is a phase not sold.
3. What is explicitly excluded. A short, blunt list. Architectural services, structural engineering, permit expediting, rooms not named, and anything you've ever been assumed to be doing for free. This paragraph prevents more disputes than any other.
4. Deliverables per phase. What the client actually receives — drawings, boards, schedules, specifications. Countable items, not "design services."
5. Fee and structure. The number, the model, and the calculation if it's percentage-based.
6. Payment schedule. Retainer amount, phase billing, net terms, and late fees. Take a retainer that's meaningful and hold it against the final invoice, not the first.
7. Revision allowance. Rounds included per phase and the hourly rate for further rounds. Two per phase is a common standard. The number matters less than having one.
8. Procurement terms. Markup or fee structure, who holds the deposits, who owns the freight risk, what happens with damaged goods, returns, and manufacturer delays. Also: payment is required before orders are placed. Firms that float client purchases on their own credit are running an unsecured lending business.
9. Client responsibilities and response windows. What they must provide and by when. State what happens to the schedule and the fee when a decision takes six weeks — because it will.
10. Change orders. A named process, a stated rate, and a written form. Not a conversation, not an email.
11. Photography and publication rights. Your right to photograph and publish the completed project, and any confidentiality carve-out. This is the clause that builds the portfolio that gets you the next project — and it is nearly impossible to secure after the fact.
12. Termination. How either party ends it, notice required, and precisely what you're owed at each phase.
The four omissions that cost the most
Scope creep has no mechanism
Almost every agreement defines scope. Very few define what happens when scope changes. Without a written change-order process, every addition becomes a judgment call in the moment — and in the moment, with a client you like and a project you want to go well, you will absorb it.
The fix is unglamorous: a form, a rate, and a rule that work doesn't begin until it's signed. Firms that adopt this consistently report the same thing — clients stop asking for as much, because the request now has a visible price.
Client delay is free
Design agreements set deadlines for the designer and none for the client. A project that stalls four months while a client decides fragments your schedule, blows your resourcing, and often pushes delivery into a season where your costs are higher.
Two clauses fix it: a stated response window, and a reactivation fee if a project goes dormant beyond a defined period. The second one sounds aggressive and is entirely normal in adjacent professions.
Nobody wrote down what happens if it ends
Projects end early — clients divorce, sell, run out of money, or simply stop. Without a termination clause you're negotiating from zero at the worst possible moment.
State what's owed at each phase, that work-to-date is billable on termination, and that drawings and specifications don't transfer until paid in full.
Publication rights weren't secured
You finish a beautiful project, and the client declines to let you photograph it. That's now a project that can never appear in your portfolio, be submitted for press, or win you the next commission at that level.
Secure the right upfront, with a reasonable confidentiality accommodation for clients who need one. Asking at the end has a much lower success rate than asking at the start, when everyone is optimistic.
A note on tone
Firms resist tightening agreements because it feels adversarial — like walking into a new relationship braced for conflict.
It's worth framing the opposite way. Every one of these clauses exists to prevent the conversation where you feel exploited and your client feels ambushed. Clear terms are a courtesy to both parties. The clients who object to reasonable terms are, reliably, the clients who were going to be the problem.
And a practical point: the agreement is a sales document as much as a legal one. A clear, well-organized agreement signals a firm that has done this many times. A vague one signals the opposite, and clients read that correctly.
This article describes common commercial terms in design agreements. It is not legal advice — have a licensed attorney in your jurisdiction review your agreement before you use it.
Related reading
Frequently asked questions
What's the difference between a letter agreement and a contract? Functionally very little. A letter agreement is a contract in a shorter, less formal format. Both are binding; the letter format is simply more approachable for residential clients.
How much retainer should I take? Enough to be meaningful and to cover your exposure through the first phase. Hold it against the final invoice rather than applying it to the first — it keeps you protected at the end, which is when problems surface.
How many revision rounds should I include? Two per phase is common, with additional rounds billed hourly at a stated rate.
Can I use a template? As a starting point, yes — AIA and ASID both publish standard forms. Have an attorney in your state adapt it. Templates get the structure right and the jurisdiction-specific parts wrong.
What if a client refuses to sign? Don't start. Work performed without a signed agreement is work you may not be paid for, and a client who won't sign reasonable terms at the beginning is telling you something worth believing.
19th & Co advises founder-led architecture and interior design firms on fees, hiring, operations, and business development. Founded by Christine Woodward — M.Arch, fifteen years in practice — the firm has worked inside more than 500 design firms, delivered over 3,000 coaching sessions, and advised more than 1,000 designers and firm leaders one-on-one.
If your projects keep going profitable-to-painful somewhere around week nine, that's usually a document problem. You can book a strategy call on my calendar here.
Last updated: August 21, 2026
