Hiring a Home Improvement Contractor
In today's market, many homeowners hope to save money by improving or expanding their current home instead of purchasing a new one. Large and expensive projects such as adding rooms or floors, or remodeling kitchens and bathrooms often require a contractor's services.
What Is a Contractor?
A construction contractor oversees and coordinates the entire home-improvement project. They are responsible for hiring and paying individuals or other companies (subcontractors) who perform tasks like installing drywall, painting, or working on electrical or plumbing systems. They also purchase materials, often for better prices than a homeowner can negotiate. State law requires contractors to be licensed and carry workers' compensation and liability insurance, but licensing doesn't guarantee the contractor's honesty or reliability.
How to Find a Good Contractor
Speak with friends or family about their experiences with contractors. The vast majority of contractors get their business from referrals-and most people are more than happy to voice their opinion. A local, high-end lumberyard can also provide contractors' names. Shop operators tend to know the contractors who value quality materials and do good work. You could also take a drive around your neighborhood and look for current construction work you admire. Often the contractor will have a sign in the yard with a contact number.
Choosing a Contractor
Submit your project to at least three contractors. Ask each for a minimum of three references from projects similar to your own, and get as much information as you can from each referral. View previously completed jobs and visit the contractors' current job to examine working conditions and safety considerations.
Call your State License Board to make sure the contractor's license is current and to uncover any complaints or disciplinary actions. You should also check for a contractor's history with the Better Business Bureau, local consumer protection agencies, and your city's building department.
Make sure you specify exactly the same project requirements for each contractor's bid. All bids should be in writing and specify the exact scope of the job, the timeline for starting and completion, precise specifications and the brands of appliances and materials, how and when funds will be disbursed, and a contingency amount for unexpected complications. A contractor should not ask for more than $1,000 or 10% of a job's cost (whichever is more) as a retainer.
Once you've accepted a contractor's bid, include all the details in a contract and have an attorney review it. Consider adding a penalty structure in case the job is not completed as originally agreed upon. Keep excellent written records and never make payments in cash.
Watch Out for Red Flags
The California Contractors State License Board offers these tips to help sort good contractors from bad. Avoid contractors if:
- You cannot verify the contractor's name, address, phone number, or credentials.
- The contractor gives you a toll-free number or post office box as the only point of contact.
- You feel pressured to sign a contract (even if you do sign, remember that you do have three days to cancel a contract).
- The offered price is only good if you sign the contract immediately.
- You are promised an extra-low rate because your house will be used for advertising.
- You cannot verify references.
- The contractor is not licensed, insured, or bonded.
- Payment is demanded up front, in cash, or must be made to a second party.
- A completion certificate is demanded before the job is completely and satisfactorily completed.
