8 things to know before hiring a contractor

Your home is your most important financial investment. When it’s time to perform repairs, add on, or remodel; you deserve to know that the people and businesses doing the work can be trusted. There is perhaps little else that can throw a wrench into your life’s progress, completely disrupt your home and family, and decimate your finances like home improvement fraud. The good news is, it is easily avoided by taking the time to follow these simple steps before hiring a home improvement contractor.

Always Get Three Bids

Generally, consumers make a big mistake on both ends of this spectrum: failing to get more than one bid, or getting far too many bids. A tried and tested method is to solicit at least three bids. Doing so gives you the idea of the general price range of the project and also enables you to quickly identify those who may be way off of the mark on either the high side or the low side.

Don’t ever rely solely on price for a project. Use the price as one consideration in the process. Ultimately, you need to select your contractor based on other factors including presentation, communication, professionalism, flexibility, and their willingness to provide credentials and references. You are going to be interacting with this contractor and their crew a great deal over the course of your project. Having a respectful, punctual, and clean contractor who communicates well is just as important as the price that you pay — especially when they’re practically living with you during a large-scale project.

The goal in taking the time to get three estimates is to end up with a high-quality project completed in a substantial workmanlike manner at a fair price. That’s a return well worth your time invested.

Price vs Value

One of American business magnate, Warren Buffett’s most famous quotes is, “Price is what you pay; value is what you get.” Don’t ever base the decision of awarding a home improvement project to a contractor solely on price. The ultimate value of the outcome of the project is what you will be living with (literally and emotionally) for a very long time.

Perhaps prominent social thinker and philanthropist, John Ruskin, put it best in the 1800’s:

“Quality is never an accident; it is always the result of intelligent effort.”

“It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money - that’s all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do.

“The common law of business balance prohibits paying a little and getting a lot - it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.”

Know the Quality of Materials Being Used

Ask your potential contractor where they will be purchasing the materials. Check the reputation of the supplier(s) and the brand of materials. Quality-conscious contractors will not stake their reputation on the installation of inferior products that are not backed by the manufacturer and by the supplier. These products may cost a bit more but ultimately will deliver a higher-quality result, and longer-lasting satisfaction. Visit the supplier showrooms – if possible – to view the materials on display. Take the time to talk to an experienced sales person and learn about the item(s).

Spend Local

Local, independent suppliers and contractors alike, live and work in the same communities as you. The money they earn is reinvested back into those communities, local governments, parks, schools, and emergency services which benefits all involved. Avoid large national contractor and supplier conglomerates who seldom have your best interests at heart, use workers from well outside of your region, can be very difficult to deal with, often lack accountability, and do not reinvest in sustaining the local economies.

Verify Licensing and Insurance

In the state of Pennsylvania (and multiple other states) all contractors must be licensed with the state Attorney General’s office. While having this registration is not an endorsement as to the quality of workmanship, not having it is a high-flying red flag. If a contractor is not registered with the state, grab your wallet, walk away quickly!

To verify the registration of a home improvement contractor in Pennsylvania, go to the Registered Contractors section of the Attorney General’s website. All contractors must display their official registration number on all contracts, esti mates, proposals, and advertisements.

You should also check for documented complaints with the Better Business Bureau.

Get References and Call Them (customers and suppliers)

Always ask your contractor for references. This includes, of course, references of recent customers for whom the contractor has completed like projects. But also ask for references from the contractor’s supplier(s) that they will be using for your project. Call them or stop in and have a brief conversation to get a feel for each individual’s perception of the contractor in general, as well as details of project flow, cleanliness, communication, and punctuality.

The people who sweat the small details (i.e. how clean they keep their trucks and tools, being punctual, leaving the jobsite clean at day’s end, and how they and their crew present themselves) will most often care more about the big details (like the outcome of your project).

Always have a Contract.. and Read It

Nailing down a project’s specifics in a written contract protects the homeowner and the contractor. It’s critical for you to have a signed contract before any work begins. It’s also critical for you to read and fully understand what’s in the contract prior to signing. It’s common for a contractor to ask for one-third to one-half of the contract price in advance as a deposit. Don’t ever pay the contract price in full until the work is completed to specifications.

Know Your Rights

A home improvement contractor must provide you with a copy of the complete contract, free of charge.

You have the right to rescind your home improvement contract without penalty within three business days of the signing date, except as provided under law for emergency situations.

A home improvement contract is not enforceable against a consumer if it does not include all of the information required by law.

A contractor may not demand or receive any payment for a home improvement before the home improvement contract is signed.