With the recent surge in mortgage rates, many homeowners have chosen to stay put, especially if they currently have an attractive interest rate. But that doesn't mean you're not still pining for a gourmet kitchen, spa-like bathroom or real office (with a door!) so you can work from home in peace.
While undertaking a remodeling project may initially sound satisfying, there are many reasons not to DIY, whether you're limited by time or talent. However, contractor horror stories abound: In fact, the Consumer Federation of America finds that the category of “home improvement repairs and contractors" has the second most consumer complaints in the United States.1
That doesn't mean you have to throw in the trowel. Here are five ways to vet a provider and find a professional contractor who's skilled, reliable and trustworthy.
1. Seek Up-To-Date References
Talking to recent clients is one of the best ways to get a sense of how well the contractor performs. But while glowing accolades on their website may appear to offer good news, remember that it's unlikely a contractor would share a negative review.
A better place to start is to ask around to see if local friends have had work done and how it went. If a neighbor just completed a project, knock on their door and get some details. You also could post on a local neighborhood site like Nextdoor or Meta/Facebook to get contractor suggestions from people who have been happy with recent work.
2. Compare Multiple Bids
A contractor might have their own system for creating a bid, so you want to be sure you're comparing the same costs. For example, perhaps the first bid you get is a total number that includes materials and labor, while the second one has all these line items listed separately. You'll want to revisit the first bid and have them specify exactly what it includes so you don't find out too late that they hadn't accounted for a key element, like light fixtures. Also, ask if permits are included and if you will be getting them or if they will.
Make sure you conduct the project discussion and bidding in person, rather than over the phone, so they can walk through the space. That can help identify issues that might be more costly than expected, such as moving plumbing or adding an electrical outlet. Have them measure floors, walls, etc. so they can accurately estimate material costs. The more information you give them, the more precise your initial quote will be.
However, keep in mind there still may be cost overruns, so discuss their process for providing an estimate as those arise. There are often unforeseen circumstances, such as unexpected water or structural damage, that may become apparent once demolition begins.
Once you have several written quotes, move to the next step. The lowest bid isn't always the best value if they can't complete the work on time or on budget.
3. Thoroughly Check Credentials
No matter how glowing the recommendation or smooth the bidding process, make sure to conduct your own due diligence. Here are some tips:
- • Start with a Google search of the company and/or owner's name and “complaints." You might be surprised at what pops up.
- • Check online databases like the Better Business Bureau and Federal Trade Commission to see if there have been complaints filed or legal action taken.
- • Reach out to your neighborhood site to seek feedback from anyone who's worked with your top choice.
- • Ask your contact to supply their contractor's license, then check if it's still active through the National Association of State Contractors Licensing Agencies (NASCLA).
- • Do the same with their insurance, and call the carrier to verify that they have the relevant coverage for worker's compensation and property damage. Recommendation site Angi (formerly known as Angie's List) offers a tool that shows the licenses that should be held by builders in each state.
- • Visit one of their current job sites, and while you're there, ask a subcontractor how the working environment and communication are. (While some contractors have their own employees, many use subcontractors who are specialists in their line of work.)
- • Keep in mind that while it's not necessarily a deal breaker if a contractor is newer, someone with more experience can be more credible.
4. Create a Payment Schedule
Once you've made your decision, it's time to talk about payment.
Never, ever begin work without a signed contract in hand that includes a payment timeline. A reputable contractor won't ask you to pay up front; instead, you want to stagger your payments so they correspond to various stages of work. If a contractor's payment is tied to a deadline, they're more motivated to keep the project on schedule. As you develop the payment schedule, make sure your final payment is due after all the work is finalized and you've had your final inspection.
They'll probably ask for an initial deposit to hold the place on their schedule, and they may ask you to pay up front for materials, so be prepared to have that money ready. In the meantime, stashing your cash in a high yield savings account or money market account allows it to stay accessible while still earning interest.
To create a record of payments, don't pay in cash. Using a credit card is the best way to protect yourself. For the most bang for your buck, choose one that has special offers or other perks attached. And remember to save all your receipts and any applicable warranties.
5. Choose a Contractor You Mesh With Personally
While cost and quality should be the overriding factors in your ultimate selection, ideally you'll also choose someone whose personality and communication style matches yours. While a remodel is exciting once it's done, the process can be stressful and disruptive as workers traipse in and out of your house. Having someone who is committed to proactive communication on schedules and budgets can be an asset throughout the project.
Your Dream Home Awaits
While your home improvement project will eventually pay off in more usable space, you want to avoid having the project become a nightmare. Taking time to thoroughly vet your contractor up front will pay off down the line.
Cathie Ericson is an Oregon-based freelance writer who covers personal finance, real estate and education, among other topics. Her work has appeared in a wide range of publications and websites, including U.S. News & World Report, MSN, Business Insider, Yahoo Finance, MarketWatch, Fast Company, Realtor.com and more.
READ MORE: Leave It to the Pros: 13 Home Improvement Projects to Avoid
Sources/references
1. Nation's Top Ten Consumer Complaints. Consumer Federation of America. May 24, 2023.