How to Hire a Contractor
Whatever the size of your home remodel job, be careful when hiring a contractor. Many are legitimate professionals, but shysters abound. Some tips:
l Check with friends, neighbors, trade associations, and home improvement stores for referrals.
l Find contractors through ads, but check around before hiring. Word of mouth is the best form of advertising.
l Get three bids, then bargain. Contractors routinely lower bids.
l If a bid is substantially lower than others, ask why. Will the contractor use inferior products, or is he too inexperienced to make an accurate estimate?
l Are estimates based on a fixed price or a “cost-plus” bid? In a fixed price bid, changes during construction are re-negotiated. In a cost-plus bid, the contractor does the job, then submits receipts along with an invoice for labor.
l Some state laws limit the amount of money a contractor can request up front. Contact your local consumer protection agency to find out the laws.
l Do not hire someone who has “just completed work in your area” and offers bargain prices.
l If the contractor’s address is a P.O. box instead of a street address, run the other way. Also check phone numbers. Work only with people who can afford a receptionist.
l Refuse offers from slick salesmen who use high-pressure tactics.
l Don’t hire someone without a written estimate, contract, contractor’s number, and local references.
l Arrange for your own loan and never pay in full up front.
l Arrange to make payments upon completion of defined amounts of work.
l Include written warranties. Note the name and address of the party responsible for honoring the warranty, as well as the warranty’s time period.
l Specify who is responsible for obtaining and paying for permits, and insist that construction codes are followed.
l Every contract should include the following: 1) A detailed description of the work and the materials to be used; 2) the total cost of the work and a payment schedule; 3) additional promises made by the salesperson/contractor; 4) start and completion dates, warranty information; 5) cleanup information;
and 6) the signature of you and your contractor.
Make sure you are satisfied before making final payment. As long as you have your money in hand, you call the shots. Still, be aware that some states allow subcontractors and suppliers to file a lien against your home if you hold payment unnecessarily.