Spring is just around the corner and you may be thinking of building a new home, adding a deck, a screened in porch or room addition. If you or someone you know is preparing to hire a contractor there are a few specific issues that you might want to address. Here are my top 3 things to consider when hiring a contractor.
Know Your Boundaries and Communicate Them
First and foremost, clear communication is paramount. If you know what you want the contractor to do for you and can clearly relate that need, your contractor is less likely to misunderstand those instructions. Cost overruns almost always start with poor communication. Step #1 starts with You! Write it down.
$$ Get More Than one Price $$
After you’ve written down your “needs list”, interview several (at least 3) qualified contractors/remodelers and, again, ask them for written bids. Here are the most important aspects of a construction project (in no particular order).
- the scope of work – this details what you want and where you want it. It can also cover other ground rules of the project; is the contractor allowed to advertise on your property, how do you handle smoking in your home or on street and off street parking during construction. Take your time and think this through.
- warranties – does the contractor offer a warranty. Some states vary on the demands of the warranty. Call your Secretary of State office if you’re unclear.
- references – even if you think you know the contractor don’t hesitate to ask them for a short list of past clients and, please, call them, ALL!
- time frames – like the scope of work [above], when will the contractor start and when will he/she stop. This can also address other specifics :: do they work on Sunday, can/do they work late into the day or night.
- price – this option might include payment plans, up front deposits, in-progress draw/payments and other related cash flow terms and conditions.
Don’t Get Scammed – Watch out for These Warning Signs
Here’s a list of warning signs that could/should create a level of concern for you as you evaluate a contractor.
- Reference Verification – provides a credential or past reference that can’t be verified.
- Do they offer a special price only if you sign today? Do you feel they’re using high-pressure sales techniques?
- They only accept cash, they require large deposits or the entire budget up front, or the contractor asks you to make payment for materials in their name.
- Can’t or won’t provide a written contract or fully completed bid.
- The contractor asks you to get the building permit! In most instances, if you have hired a contractor, the contractor is required to take out the permits. Permits are your protection and help ensure that work will meet local building codes.
- Offers an exceptionally long warranty. Legal questions should always be handled by an attorney.
- The contractor wants to do most or all the work on weekends and/or after hours.
And…if your contractor gives you an offer that sounds “too good to be true.” Most likely … it is.We sum it up here…
Disclaimer :: This advice is given as general information and is not intended to be legal advice. As I’ve mentioned above, legal questions should always be answered by legal counsel.
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5 thoughts on “Top 3 Things to Consider When Hiring a Contractor”
Great post Gary full of good information.
There are some excellent short videos on a 203k channel at http://203kExperts.com as well.
HUD 203k Consultant
Great tips Gary. Always good stuff related to helping our customers with the FHA203k Renovation Tricks.
Thanks Vito, you’ve got some good looking videos with top notch info.
Bo, you’re right, contractors in our area do a great job and we’re here to help them make wise choices!
Weighing in on this post as a contractor I usually find most homeowners who do create that list of what they want to do are 50% ahead of other homeowners. As a contractor though I find most of these lists don’t take into account value engineering or alternative solutions to solve the problem. I suggest interviewing 3 contractors and hiring one you trust to help figure out what the list really should be. Thirty percent of homeowners who bring these lists to me end up deciding a remodel is not the right thing to do
Yes sir, you’re correct and you made an excellent point with your comment on Facebook about how some borrowers who work with the FHA 203K Rehab program think they’re experienced enough to perform work on the job. As a consultant who has worked with hundreds of these rehab projects, when a homeowner elects to participate in the project with sweat equity the project starts to unravel. Working along side the contractor also opens both parties to increased liability. It’s best to hire an experienced contractor and leave the job to the experts.
For those who are not members, join us in the Facebook Group :: FHA 203K Pros at this link: https://www.facebook.com/groups/203kconsultants/