Contractor way over budget on time/materials contract - help with next steps
I'm looking for advice on how to navigate dispute with a general contractor on a remodel (small garage conversion) project that's 75% over budget. It's a time and materials contract originally budgeted $70-85k then scope started slipping from intentional requests (~ $8k of the $65k overrun), misunderstandings (some of this is on me) and things found (dry rot, cracked water mains, some reason to relocate the electrical panel). I was never informed about the cost of the overruns or that there even were overruns beyond the ranges in the contract (apart from what I requested). The invoicing was also super sloppy, I was doubled charged for things, charged for a door I paid for myself, charged for things they said would be free etc although they did rectify the obvious invoices issues when I pointed them out.
What are my options?
Lawyers - Appear to be expensive (quoted a $2500 initial retainer and $10k+ to litigate). Also probably unnecessary as my contractor is willing to negotiate somewhat. A free AI lawyer suggested we assess the fair cost for the work done (contact a construction cost estimator?) and decide on litigation / negotiation from that.
Negotiate with my contractor - I'd prefer to negotiate but with leverage in hand, maybe documents that support a legit-sounding lawsuit or rationale for the dollar amount?
Just not pay - I still haven't paid ~ $25k of the invoices, and the project is basically done, so worst case I could just refuse to pay but I'd rather not do that.
How can I get the most money back? Is there some sort of documentation or opinion that I could generate quickly and cheaply to use in negotiation? Come out guns blazing with threatening letters from a lawyer? Hold on to the money and tell the guy to get lost?