How to Hire a Contractor
by Michael LaLonde
Introduction
Hiring a reputable contractor can often be a painful task. But whether you're planning a new bathroom or adding a large addition to your house, finding a reliable and competent contractor is vital to finish with a successful home improvement project. As you may know, finding the perfect contractor isn't really just a phone call or click away. It takes some time and investigation to get the best contractor amongst the varying costs, professionalism, expertise in your area, and availability to do the job. Researching can save you hundreds of dollars, make your life easier, and can result in a more successful home improvement project.
Contractor Search
The most trusted way for someone to find a contractor is by word of mouth. Ask your friends, family, co-workers, neighbors, or someone else you trust if they can send you on your way to a good contractor. If this fails, there are still other options. First, you may look in your local Yellow Pages under "Building", or if you seek a specialized area of work, you can look that up directly. Local trade organizations often have names of many contractors in the area that you can contact, as well as information regarding previous complaints. Finally, the internet can often provide many good contractors at a click of a button. Our favorite contractor resource website is, of course, JimSalmon.com, but there are many others out there specializing in different parts of the county or world. After you have gathered several names of contractors that might be of interest, its time to go to the phones.
Getting Estimates
Usually five or six names and numbers will be sufficient enough to find a good contractor. Dial up your potential contractors to determine if you want them to place a bid on your project. There are several elements that you should describe to your potential contractors on the phone.
Clearly Describe the Project
Make sure you give the contractor a good idea about exactly what needs to be done. If they are unsure about the project they may be uneasy to place a bid. Contractors may request to see the site of work before determining whether or not they are interested.
Start and Ending Dates
Tell your contractor when you want this project to take place. Some contractors can be booked for weeks. It wastes time if a contractor wants to bid and later finds out that it has to be done within a certain time period.
Licensing and Registration
Ask the contractor if they have proper licensing and registration. Many states require a license. It would be considered illegal if you allow them to operate without one. To find this out, you can contact your local building department or consumer protection agency for requirements.
Samples
Quite often, contractors have a picture portfolio of past work that they have done. Looking at this can help you determine how professional their final product is and their experience with working with projects similar to yours. If they don't have a portfolio, you may want to look at projects similar to yours currently being constructed.
Make Appointments
Make Appointments with at least three contractors that want to make a bid. Remember not to automatically jump at the lowest estimate. There are several variables that you must take into account, including work quality, quality of materials, speed at which finished, and the cost. A contractor using higher quality materials may cost a little more, but may turn out better in the end.
Be Prepared For The Meetings
Know what you are talking about before the contractors come. Be able to describe to them your project in detail. Know your exact needs and expectations for your project. If architectural plans are needed, a rough, quick sketch could prove to be very helpful. Material preferences should be predetermined so your contractor will know what he/she will be working with. Show them pictures or magazine cutouts of projects similar to the one you want done. In this meeting, your goal is to paint the clearest picture you can into the mind of the contractor so they know what would be expected of them.
Meeting the Contractors
When the contractors give you their cost estimates, they will probably be higher than you expected. They aren't necessarily aiming high. Usually these contractors know a lot more about a project than you do, and a wall you want replaced could be supporting upstairs, thus adding extra time and costs. The most important thing to do at a meeting is to ask lots of questions. Ask what possibilities and alternatives there are to this project. There may be multiple ways of approaching it. Be sure the contractor is very professional and is clear about what they can and can't do. Be sure to figure out details about how long they have been in the business. Make sure there are no unresolved consumer complaints. Ask how many projects they have done similar to yours recently. Is there are permit needed? Finally, it is important to ask if they plan to use subcontractors. If they do, meet with them as well. Make sure that they have all insurance needed and are licensed if required. Be sure that they were paid in a timely manner on previous projects. If your contractor fails to pay the suppliers and subcontractors, the suppliers and subcontractors could file a Mechanic's Lien on your house. This means that they can take you to court and force you to sell your house to pay the unpaid bills of the contractor. Ask everyone for a lien release and lien waiver to protect you. Finally, be sure these people are the type that you want around your house and kids. Will you trust them with your keys if needed?
The next step is to have the contractors send their estimates in writing. This is called a fixed-price bid. In other words, the price won't be subject to change due to contractor mistakes and future changes. It should include the detail of costs of both labor and materials. It should also include an approximate time frame for the project. Remember to base all these estimates on the same scope. Don't get estimates on project descriptions that are not the same.
Hiring a Contractor
Remember not to jump at the lowest bidder. Be sure you understand exactly why an estimate is further off than another. It could be that one is using better materials or makes a better product. Investigate details before choosing. Licensing and registration is required in most states. If the contractors are not licensed, the work could be considered illegal. Contractors should all have insurance, including personal liability, worker's compensation, and property damage coverage. Without these you could be held responsible for an injury or damage done to your property. Building and Zoning permits can be obtained by contractors. Be sure to look in to this, better safe than sorry. If you obtain a permit the product will be looked at by a building inspector to be sure it meets government regulations. If no permits are obtained, you will have a much harder time with insurance claims.
If your contractor looks good from those perspectives, talk to past customers in which he did similar work for. Find out if the start and end times were accurate. Were there any disputes? Were they satisfied with the finished product? Ask if their project was interrupted by other jobs. Also, you may want to visit jobs currently in progress.
Writing the Contract
If you have found the perfect contractor, you are now ready to write up a contract. Unless the project is very easy and can be finished in less than 1 day, a contract is generally needed. A contract is basically a written agreement that outlines your expectations clearly, and how the contractor plans to fulfill them. It also includes clear guidelines for payment. Always get every detail in writing.
Parts of a Contract
It should explain the who, what, where, when, how, and the cost of the project. Also, the contractor's name, address, telephone number, and license number should be included.
Scope
Explicitly state all the work that needs to be done and explain each part.
Required Materials
State specifically what kind of materials you want to be used. It should include brand names, model numbers, colors, sizes, and the product. Goods such as lumber and electrical wires have code-minimum requirements. It should also state if you want higher grade materials used.
Duration
State the start date and the target end date.
Building Techniques
Tell the contractor exactly how you want everything done. From dumping garbage to applying paint, you can explain the method.
Change Orders
Change orders give authorization for work beyond the scope. This allows you to assign new jobs you want done after the building has started. It also means that you will only pay for pre-approved work.
Payment
Should include the contractor's estimate price. The most commonly used method of payment is in increments when certain jobs are finished. A portion would be paid upon signing, some when Step 1 is completed, more at Step 2, and a final payment after project completion.
Broom Clause
Putting this in the contract means that the contractor is responsible for all clean up.
Cancellation information
You have the write to cancel the contract within 3 business days of signing. It is the contractor's responsibility to provide you with 2 forms, 1 to send to him and one for your records, if you wish to cancel.
Scams
There are several signs of fake contractors hoping to scam you. Here are some clues to detecting unreliable contractors:
Door to Door and Phone calls offering a very reasonable price
Financing through a lender they know or recommend
Asking you to sign papers with black spots on them or documents you haven't read. (Don't Sign These!)
They ask you to deed your property to them. Consult an attorney
Offer you a discount for referring more customers
Saying they happen to have materials left over from their last project
They only accept cash payments
They ask you to get the permits
Want an immediate decision
Want you to pay everything upfront
Paying Your Contractor
It is usually a good idea to make a very small down payment. Some states even limit the amount that you can spend. The most common way is to pay when a contractor reaches a milestone. This way, if the work is delayed their payment is also delayed. It is also important not to make a final payment until you are satisfied and the subcontractors and suppliers have been paid. If there is a problem with the results and you make a good effort to resolve your conflict, you have the right to withhold your last card issuer payment until things are worked out.
Finishing Up
Take pictures of the job while in progress. This is important if a problem arises and you need to file an insurance claim. There are several things you should check before you send your final payment. Make sure that the work meets the standards set in the contract, you have received written warranties from the contractor, you have proof the subcontractors and suppliers have been paid, the job site is clean, and that you have inspected and approved the work done.
Complaining
As always, it is first very important to try and resolve a problem with your contractor on a one-on-one basis. Send a written document to the contractor certified mail and request a receipt when the package arrives. This gives you proof that they received your statement. Also, you can report them to organizations such as your state and local consumer protection agency, the Builder's Association or Remodelers Council, and your local Better Business Bureau.
by Michael LaLonde
JimSalmon.com home page
Sources:
How To Find and Select a Reliable Contractor
http://www.doityourself.com/handyman/index.htm
How To Hire a Reliable Contractor
http://www.doityourself.com/handyman/hire.htm
Contractor Checklist
http://www.doityourself.com/haandyman/checklist.htm
Home Improvement Loan Scams
http://www.doityourself.com/handyman/scams.htm
Home Improvement: Tools You Can Use
http://www.ftc.gov/bcp/conline/edcams/homeimp
Learn2 Hire a Contractor
http://www.learn2.com/contractor.html
Home Improvements: Dependable Tips and Helpful Information
http://www.bbb.org/library/home-imp.asp
How To Operate Your Home, by Tom Feiza
Mr. Fix It Press, 2000
