These two items are crucial to a job's success. Trade licenses are important indicators of quality, reliability and the ability to cover any unexpected injuries or other problems. Contracts literally spell out what the contractor and the homeowner are obligated to do — if a job goes poorly, you'll know what was agreed upon to help protect yourself from financial loss.
Follow these 13 hiring guidelines to help make sure your project is problem-free and high-quality.
- Clearly define your project: Before you begin talking with contractors, read remodeling magazines, search the Internet for information on designs and materials. Even rough ideas on paper give a potential contractor a better sense of what you hope to accomplish and what is required to make it happen.
- Management issues: Large projects, especially those that may involve more than three different specialists (i.e. plumber, electrician, carpenter, mason) will go better if you have a general contractor to manage all the various tasks and timelines.
- Structural issues: Projects that eliminate walls, add rooms or otherwise impact the structural integrity of your home, should involve an architect or a structural engineer.
- Ask around: Ask neighbors, friends and Angie’s List about good, local contractors, but don’t hire based on only one conversation.
- Check references: Get names of previous customers and find out if they were pleased with the work and the timeline of the project, and if they’d hire the contractor again. Get the names of subcontractors and ask if they work with the contractor often and does he pay on time. If your prospective contractor balks at providing references, find another one. Check with trade associations to learn how your contractor stacks up among his or her peers.
- Get estimates: Get at least three written estimates. Documentation is often the best ammunition you have if things go wrong.
- Where can I reach you? Be cautious of contractors who give you a post office box with no street address, or use only an answering service. Never hire someone who comes unsolicited to your door and can’t provide you proof of qualifications – especially if he or she pressures you to hire fast and pay cash up front.
- License for hire: Some states or cities have no licensing requirements for contractors, which can make it difficult for homeowners to check up on contractors before they hire. Don’t rely on the contractor’s word to know whether his or her license is valid: verify it through appropriate agencies.
- Insurance and bonding: Check the status of the contractor’s bonding and liability insurance coverage, too. A good contractor will come prepared with proof that he or she is covered.
- Budget and payment options: The typical pre-payment is typically between 10 and 15 percent of the total value of the project. Even the most carefully planned project can change, especially if hidden problems are found. Never pay for a project with cash; always use a credit card so you have recourse in case something goes wrong. Before you sign off and make the final payment, check that the work is complete to your satisfaction.
- The contract sign: Don’t assume your contract covers all your needs. Know the details of the contract, as well as how any change orders will be handled. Check that your contract includes a lien waiver, covering payments to all subcontractors who worked on the project. Never sign a blank contract.
- Punch list: This is how the contractor will deal with the list of small items remaining to be completed at the end of the job. A good rule of thumb is to determine the cost of those items, double it, then withhold that amount from the final payment, until the list is complete.
- Prepare your family for the stress: This is one of the most overlooked, but critical considerations. How will the project change your routine, especially if it’s a kitchen or bath? Where will materials be stored? What are the working hours for the crew?
