How to Choose a Home Contractor and Avoid Scams
Finding the right contractor for your home renovation is not easy. Home hunting is stressful enough, and by the time you find your dream home, you will probably have many tasks on your hands. A home contractor can help you ease the burden by completing your home improvement project on time. But watch out – This area is ripe for scammers.
The unscrupulous contractors usually take advantage of people who are busy and distracted and want to get the job done quickly – a classic scenario of new homeowners who want to move into a property as soon as they can.
According to estimates, homeowners in the United States face anywhere from 20,000 to 100,000 scams every year. That includes home improvement scammers that could show up on your doorstep uninvited, trying to con you out of money under the guise of fixing your roof, driveway, plumbing system and other components of your home.
To protect your time and money, always vet a contractor. This article outlines some of the critical steps you need to take to prevent fraud and find the right contractor who can do the home improvement job for the right amount of money.
How to determine what kind of home improvement contractor you need
When choosing a home improvement contractor, you need to know what you need to repair. This will make it easier for you to settle on a specific price range. Home contractors often try to upsell to new homeowners who are not knowledgable about renovations and could be easily convinced to add more services.
To save your money, follow some simple steps that will help you find the best candidate for the job and get the best bang for your buck.
- Determine what kind of home improvements you need
- Make a list of contractors with the best track records
- Contact your candidates and ask them questions
- Check the companies’ liability insurance and credentials
- Discuss your project with your candidates and see who offers the best quote
- Narrow down your search and decide who offers the best deal
A home inspection before buying a house can help you assess the property’s condition and determine if it needs repairs. When you know what repairs a property needs, you can negotiate the project better and choose the right candidate for the job.
For example, if the property you want to buy has problems with the HVAC system or insulation, you will know what type of contractor you need. A home inspection report outlines all issues with the property, which means an unscrupulous home inspector will not be able to sell you something that you don’t need.
Differences between general contractors vs. specialized home improvement contractors
Depending on the scale and complexity of your home improvement project, you should hire either a general contractor or a specialized home improvement contractor. But what’s the difference between the two?
Although “general contractor” and “specialized home improvement contractor” are often used interchangeably, there’s a clear distinction between the professions’ roles.
A general contractor is a project manager who oversees the home improvement project. This project could be anything from indoor remodeling to major outside renovations. A general contractor can be a single person, a small company, or a big firm.
A general contractor deals directly with a property owner and hires subcontractors if needed. General contractors oversee a team of people who get assigned different parts of the project like plumbing, painting, and design, among other things. The primary responsibility of a general contractor is to find the right person for the job and ensure that the project is of quality and delivered on time.
According to Career Explorer, a plumber is someone who maintains and installs pipes in residential and commercial buildings. Pipes require maintenance and check-ups since they are a critical home component. Plumbers typically repair pipes, create blueprints for pipes’ layout, and help with installation.
Since a broken pipe can cause severe damage to the property, plumbers have a secure job that remains in demand regardless of the economic situation.
According to CareerBuilder.com, an electrician is a tradesperson who designs, installs, maintains, and repairs the electrical systems and products used in residential homes, businesses, and facilities like warehouses and factories.
An electrician’s primary duty is to ensure that lights, equipment, and electrical appliances operate safely. While there is a general electrician field, there are also many types of electricians who specialize in different components of properties.
For example, residential electricians typically work on single and multi-family homes, while inside electricians take care of control systems and electrical systems in commercial buildings and extensive facilities.
Heating, Ventilation, and Air Conditioning, also referred to as HVAC, are called HVAC technicians. An HVAC technician is responsible for testing electrical circuits, installing climate control systems, heating, and air conditioning systems, and maintaining and repairing HVAC units and equipment.
Other home improvements
Other home improvements, including foundation repairs, concrete, masonry, landscaping, and roofing, require specialized services.
Home inspectors typically check all of these components during a home inspection, so when you get a report, you will know what needs attention and the exact condition. Having a detailed home inspection report should help you find the right professionals.
Signs that the professional might be a good fit
Choosing the right contractor for a home remodeling project can be challenging, and finding someone you can trust is critical. Since the project involves your time and money, always go through the vetting process and watch out for red flags that might indicate that they are not a good fit for your project. Working with quality home improvement companies ensures that you have qualified contractors on the job. During the hiring process, top-tier home improvement businesses vet their candidates to get the best employees. Home contractors can find the right employees for their business by following four essential tips for hiring
One of the ways to vet your potential home contractor is by asking them to provide at least three references.
Contractor’s references are important because they can offer detailed information about a contractor’s past work. Past clients can tell you about what a contractor is like to work with and determine whether you should hire them.
Aside from having the right experience and credentials for the job, a home contractor also needs to have good communication skills. When a contractor communicates with you promptly and is willing to provide all required information, including references, this is a good sign.
However, remember that references provided by inspectors might be prepared for an interview and have canned responses to some of the most common questions.
To avoid generic responses or “yes” or “no” responses, ask open-ended questions or questions that require more detailed responses that usually start with “how,” “why,” or “how many.”
A home remodeling project is a significant investment, and you should hire a candidate with the most relevant experience.
Ask your contractor about their past projects, and see if they provide any photos or videos of any home improvement jobs in their portfolio. Experienced contractors can provide this information quickly; in many cases, you can find these materials on their websites and social media.
If a home contractor is unwilling to show examples of their past home improvement projects or go into details about their experience, this is a major red flag for homeowners.
To avoid getting scammed or sued, hire only those contractors who can provide proof of their liability insurance and relevant licenses. If a contractor is not insured, you could be liable for their injuries on the job. Ensure their insurance covers bodily harm and property damage, so you are off the hook.
Why is it important to hire a licensed professional
It is critical to hire a licensed contractor. It will help you to avoid paying thousands of dollars in hospital bills and follow-up treatment should they become injured on the job. It will also help you to cover any damages to your property, should the project go wrong and you need repairs, following their job.
To check if a contractor meets your state’s licensing requirements, contact your local and state government. You can also check online resources like the Better Business Bureau to learn about licensing requirements.
Always ask for contractors’ paperwork and credentials during the interview. This will help you to eliminate bad candidates before proceeding with the process.
Personal liability insurance
Personal liability insurance is often recommended for home contractors. It helps to protect a contractor’s business from legal claims that they have caused damage to someone else’s property or bodily injuries.
Those business owners who don’t have personal liability insurance could face liability claims that might need coverage out of pocket.
Property damage coverage
Property damage coverage covers a contractor against any claims of damage by clients or third parties. Legal claims can originate from many incidents. If somebody gets injured as a result of your activity on the job, you could be liable for their injuries.
For example, if a person trips and falls over the cord that you left on the floor while working on the renovation project, you could be liable for their injuries.
How to protect yourself from home contractor scams
Always vet a home contractor before hiring to protect yourself from scams. Always interview them to learn more about their experience and assess their interpersonal skills.
Before agreeing to proceed, pay attention to their communication style, customers’ reviews, and rates. You might have to spend more time before you choose the right candidate, but you will avoid getting scammed.
Ensuring the contractor is not fraudulent
Fraudulent home contractors prey on inexperienced and elderly homeowners who can’t do the job themselves and have little to no expertise in home renovations.
High-pressure tactics, low ball offers, and shabby, unprofessional equipment are all tell-tale signs of scammers. It’s typically not a good sign if a contractor asks for full payment ahead of the project. A vetted contractor who knows their trade can also furnish proper permits and licenses upon request.
Why it’s important to ensure a contractor is legitimate
Ensuring a contractor is not fraudulent will help you avoid major headaches and lost money. It can also save you from any legal liabilities. Although the vetting process takes time and research, it’s well worth the effort, as it will help you hire the right contractor and not someone looking to make a quick buck by scamming you.
Suspecting dishonest or even unlawful behavior
If you suspect that a contractor is not honest and doesn’t have the required paperwork to operate a business, never hire them. Fraudulent contractors can be hard to track down as they sometimes move between areas or even states, and once your money is gone, you will not be able to get it back.
If you suspect a home contractor is operating illegally or engaged in unlawful activity, contact local or state officials or consider suing in the small claims court.
Additional actions when hiring a remodeling/home improvement contractor
When looking for a remodeling contractor, check all available resources. While a quick online search will reveal top contractors in your area, don’t forget to check other places. A website like Yelp has a lot of customers’ comments, and social media platforms like Facebook can have a lot of information about home contractors in your area.
Finally, don’t forget to ask for referrals. Your friends and family can refer you to home contractors in your area. Asking your neighbors is also a great way to find new contractors in your area.
Get estimates before hiring a contractor
Always get an estimate before hiring a contractor. It will help you to compare the offers and get the most competitive quote. Contractors with the best ratings and experience typically charge the highest rates. That, however, doesn’t mean that you can’t trust less experienced professionals if they have stellar customer reviews and good examples of their work.
Make a contract that you are comfortable with
When signing your home improvement contract, make sure you are comfortable with it. Never allow a contractor to pressure you into something that you don’t want to do or don’t have money for.
Draft an agreement with your contractor and ensure you are on the same page regarding terms and conditions, payments, and other critical details. Go over all clauses of the contract before signing it.
Check payment options/ payment plan agreement
Your contract should specify available payment options. Most contractors ask for a small downpayment before starting the project, and you can pay the rest once the project is finished.
Payment options can vary between contractors, and you should double-check that information before signing any paperwork, let alone starting the project
Verify Insurance coverage
Insurance verification is one of the most steps when considering a home improvement contractor. It’s one of the most efficient ways to weed out bad candidates because contractors with insurance and proper permits should have no problems providing proof. You can ask for appropriate paperwork during the interview process
Meet in person/check showroom
Meeting your potential home contractor in person is a great way to break the ice and start the dialogue. During the meet-and-greet, you can assess their communication skills, ask questions and see if they are a good fit for your project.
Hiring the right home contractor takes time, effort, and critical assessment. Not every contractor is suitable for the job, even if they have the required qualifications. Carefully vet all candidates by assessing their experience, required paperwork, communication skills, and quotes. You might spend more time, but you will be more likely to hire someone who is the right person for the job.