Why it's so important to do your due diligence when hiring a contractor
As a contractor myself I hear the horror stories time and time again from homeowners that have been taken advantage of or poorly mistreated due to a lack of preparation on their part. When it comes down to it, the responsibility of getting all your ducks in a row and exploring all of the contractors available to choose from, checking licenses, insurances, review, and best practices, it truly is up to the homeowner. While pricing is surely important, if this becomes your main focal point in choosing a contractor, you do usually get what you pay for.
So, 2 weeks ago we started on a very small job rehabbing a shed. We were simply replacing the T1-11 sheathing on either end which only took us 2 days. During the install we got into a conversation with the homeowner as to how she literally just got screwed from another contractor just weeks before. Being curious I asked for the details of what happened. She had hired someone to do a small amount of tile work in her bathroom for $1500. The guy seemed very nice when she met him, was a smooth talker and never signed a contract. She gave him the $1500 and awaited his call. After several delays he did finally show up only to start and leave after 1 day’s work leaving his tools behind. He never came back, not even to get his tools and now she is going to small claims court. In this short and true story there are so many things that went wrong and while she likely won’t ever see her money or this guy ever again, at least it’s only a $1500 learning mistake.
Before starting any project in which, you need a contractor, start with a plan! Below is a list of what I think should be your focal points in choosing the right contractor and do make note that price is not one of them.
1. Reputation & Review of work
2. References & Communication
7. Change Orders
8. Understand the Process
Reputation & Review of Work
In today’s day and age of social media things have never been easier to find information on just about everything. Customers have the freedom to leave reviews of their experiences both good and bad on a series of platforms and in many cases upload photos of the work performed. As a contractor there are several of these that we use not only for marketing and lead generation purposes, but also to collect reviews from our clients for others to see. Platforms such as Google, Angie’s List, Home Advisor, Guild Quality, Houzz, the Better Business Bureau, Yelp, the contractors Facebook page and many others abound.
What you’re looking for on these sites, especially those in which the contractor has no control over or ability to change or delete reviews, is an overall positive consensus. While I can proudly say that Beantown Home Improvements has stellar reviews across the board, don’t be surprised to find a few bad ones with just about everyone. It can be hard if not impossible to satisfy everyone, but the key here is to see why the reviews were bad and if the contractor responded to the review. If homeowners posted photos. look at the quality of the work. Read the reviews in detail and focus on those that tend to be lengthy and skip the 1 liners. Seek out those reviews that mention how during the job things may have changed or something happened and or maybe got broken and how the contractor rectified it. This will give you a good sense of the company, it’s people and if they stand behind their work.
If after going through all of the reviews you don’t have warm and fuzzy feeling, move on to another contractor.
Ask for references and then call as many as you can. Every time I visit with a client, I leave a 1 page document with references that are no more than 6 months old and broken down via the work performed. When we complete a job, I ask the homeowner if they want to be on the list and if they say yes, they are added. Over time they get rotated out with new ones. Now certainly these can be cherry picked, no doubt here, but again these are still current clients that you can independently call.
It is very important that the references you receive are current ones as companies and people change over time and job completed 5 years ago may not be indicative of today’s work. When you call them, ask questions as to how did the process go from start to finish, did things go as expected or were there bumps in the road, did they finish on time and on budget, are you happy with their work , and would you use them again.
Also be sure to ask how easy they were to communicate with. Were they available when you had questions and were they answered in a timely fashion? From my experience communication is the #1 reason to either start or kill the start of a relationship. If the contractor can not easily communicate before you have a contract in place, you can be sure it will only go downhill from here.
If you’re about to spend hundreds or even thousands on hiring someone to do a job in your home, wouldn’t you want to make sure they are qualified to do so? I certainly would, but then again you may be surprised as to how many people totally blow this step.
Now I can only speak for the state of Massachusetts being a licensed contractor here, Mass requires both a Construction Supervisor’s License (CSL) and a Home Improvements Contractor’s registration (HIC).
Construction Supervisor’s License – The CSL is no joke, this is the meat and potatoes of every contractor in the field that I believe to be required throughout the entire US. Obviously, there will be variations in requirements from state to state. Now depending on the kind of work you are having done, you may or may not need to hire a contractor with a CSL. For example, in Mass you don’t need a CSL to remove or install Gutters, but you do to install a roof. The best way to find out whether or not this is needed, do a simple Google search on work requiring a CSL or HIC.
Home Improvements Contractor’s registration – The HIC is really just a registration with the state. All contractors, partnerships, and corporations that solicit, bid on, or perform residential contracting as a contractor or subcontractor on an existing one to four-unit owner occupied residential property in Massachusetts must be registered as a Home Improvement Contractor (HIC). This is nothing more than a registration with the state that anyone can get and in no way qualifies anyone for any kind of work. It is however still required to work legally in the state of Massachusetts.
Now, we always leave copies of our licenses as well as the state website in which the homeowner can look up online to make sure they are still valid. This is important because even though the contractor may be able to show you the actual license it does not mean it has not been revoked by the state.
If you’re not sure what is required for a contractor to operate legally in your state, call the local Office of Consumer Affairs and Business Regulations and ask.
Similar to licensing you may be surprised as to how many homeowners never ask for or even check a contractor’s insurance. In the state of Massachusetts, we are required to carry both a Commercial general Liability Policy and a Worker’s Compensation policy. Check with your state for local requirements and request a Certificate of Insurance (COI) that is dated currently from your contractor. This way, you can be sure that not only are they protected, but that nothing can come back on you the homeowner. If they can not or will not supply you with a COI, a red flag should go up!
In Massachusetts under the Home Improvement Contractor law, all contracts over $1,000 must be in writing. However, homeowners and contractors should consider having a contract for every job, regardless of the price to protect both parties.
Contracts are crazy important as they outline the work to be performed and in our world is our bible. If it’s not in the contract it doesn’t exist. This is why when a contract is being written and before you sign it, you absolutely should read it over to be sure it encompasses everything that was discussed and agreed upon. If things are missing have it revised. This will eliminate any questions or problems later on as to what was or was not included in the work to be done.
If during this process you are ever pushed into signing, it’s probably a good time to push back and ask why they are rushing you. Something obviously isn’t right and it’s up to you to push back.
Certain states like Massachusetts also requires a Notice of Cancellation to be signed, which allows the homeowner to cancel any contract without penalty within 3 days after signing it. This way if the homeowner has what they call buyers remorse they have a way out.
Finally make sure there is a payment schedule clearly laid out in the contract. In Massachusetts, the we split up the payments into thirds and the state notes “Any deposit required to be paid in advance of the start of the work cannot exceed one-third of the total contract price or the actual cost of any material or equipment of a special order or custom made nature, which must be ordered in advance of the start of the work to assure that the project will proceed on schedule. Final payment cannot be demanded until the contract is completed to the satisfaction of all parties.”
In Massachusetts while a homeowner can pull a permit for themselves, they should never pull a permit for a contractor. Pulling a permit for a contractor is risky as it transfers all of the risk and responsibility from the contractor to the homeowner, including meeting building code regulations. In addition to this, pulling the permit for a contractor waives the homeowners right to protection by the Guarantee Fund, which is funded from the HIC licensing renewals. In addition, if a contractor is asking you to pull a permit for them, a red flag should go up as there is likely something wrong with their license or insurance, since both must be presented to the local building department when applying for a permit!
Things change even after the contract is signed either from the homeowner adding on additional work or during the process itself when maybe the contractor finds major rot that must be replaced. Make sure you understand how these change orders are handled and you notified to prevent any financial surprises at the end of the job. What we do every time a change orders happens is to have both partials sign a carbonless form detailing the changes and the new contract amount and payments. This way both parties remain on the same page both as to the work done and the payments.
Understand the Process
Once the contract is signed if not even before, make sure you understand how the process will go to have the work performed. Make sure you understand when the job will start, when the materials and a dumpster if needed will arrive, when the crew will arrive and how long it will take. Understand how the job gets wrapped up and what happens after, meaning will you receive product warranties, when will the leftover materials be taken away and the dumpster as well. It’s also important to know what if anything is expected of you the homeowner. Do you need to be home, have furniture moved or pet’s taken out for the time being?
Hopefully my years of experience in working with homeowners can help you prepare yourself for your next home improvement project. The biggest that I can say once more is Do Your Due Diligence!