a contractor’s take on choosing a good contractor

They have a contract for you. 

Don’t be embarrassed to ask about a contract. Reputable contractors will write up a contract specific to your job if they don’t have a standard agreement. Read it before paying the required deposit. If you have any questions about it or want to make amendments, now is the time. If confronting a contractor about a signed agreement makes your palms sweaty, you aren’t alone. It’s an easy way to weed out bad contractors because a well-written and fair contract not only provides protection for you but for the contractor, so it is in everyone's best interest to have one. Here are some things to look for in an agreement:

• Statement of Relationship

  • This just states that you are the client, and they are a contractor working directly for you. That will state a business transaction is taking place. 

• Project description

  • Fairly straightforward. Make sure there are very clear-cut descriptions of the project agreed upon, including cleanup. If it isn't listed in the scope of work, it won’t be part of the deal if lawyers get a hold of it, so make sure it is thorough and includes both what is part of the work being done, and also what is not part of the work being done.

• Payment terms

  • What percentage of the total job cost are they asking for a deposit? Is there a fee for late payment? How long after the invoice is sent do you have to pay? What happens to the work schedule if a payment is late? What happens to the payment schedule if the contractor is not making significant progress on the project?

• Responsibilities of each party

  • Best to get these things in writing. What are you expecting of your contractor? What do they expect of you? What happens if these expectations are not met? 

• Project timelines

  • These won’t always be exact down to the dates, but there should be decent estimates of when the contractors think your work will be finished. If no timeline is established, satisfactory progress will become subjective and your project may drag on longer than you had hoped.

• Termination conditions

  • No one wants to think it’ll come down to this, but it’s best to have something in the agreement just in case it does. What happens if you don’t pay? What happens if they don’t complete the work? What happens if unforeseen circumstances delay or halt the project altogether? Everyone should be on the same page about this.
    
    

Ask for proof of insurance. (General Liability and Workers Comp)

Every contractor should have this, regardless of their trade. Small mistakes can quickly become costly. Insurance is a necessary protection for a contractor, and a contractor who is unprotected may leave their customer on the hook if they should experience a stroke of bad luck. Injury to your person or your property will be taken care of if they are insured, and that is what makes it so important. General Liability insurance is an expensive part of operating a business. Low estimates may seem tempting but could be an indicator that you will not be protected if the worst were to occur. Contractors and homeowners both hope to never have to call on it, but in the case of an accident, it’s essential. Like many things in this article, there's no harm in asking. 

Ask about warranties.

So you’re all set on the agreement, everything seems good, and none of the red flags are cropping up. Do they offer a labor warranty? This isn’t imperative, but it’s nice. Industries vary, and there isn’t a simple rule of thumb we can provide, but it is worth some discussion. In some cases, paid warranties are required. Not every contractor defaults to offering one, so the best way to find out is to start a conversation about it. A warranty is a good indicator that your contractor intends to be in the business long term, meaning they will be around long enough to validate this warranty should that be needed. This offers long-term peace of mind that your contractor believes in the product or work they sell and will guarantee it. 

Are they the cheapest bid?

For some of the reasons stated above: the cheapest bid usually comes with some cause for concern. There are some reasons why cheaper bids aren’t suspicious at all: for example if the shop has the ability to buy material in bulk. For most smaller projects it could be a warning sign. All things come at a cost, and a lower bid sometimes means the contractor is buying lower-quality materials, reducing their overhead in unfavorable ways (not paying for general liability insurance for example), or not guaranteeing their work. Just ask specifically about their price, and use that to determine if they are the right contractor for you. 

Don’t be afraid of deposits.

There are a few common ways deposits are addressed in the contracting industry. Some contractors don’t ask for any money down and collect the project total upon completion. This is more typical of larger contractors. Other contractors require a percentage of the total project as a deposit. Percentages vary, but 50% is common. Those who do not take deposits may tell you to be wary of someone that needs a deposit, and those that do will say they need money down to secure a spot in their schedule. Most often this money is used to purchase materials and pay their employees to produce the job so the burden upon the contractor to fund their customer’s projects is reduced. The reality is that both (and everything in between) is mostly a matter of preference, policy, and a consideration of the needs of a business and consumer. Everyone runs their business differently and neither of these methods is cause for alarm. If your contractor is requiring half down: ask them what your money is going towards. If they are trustworthy, they will be able to tell you how much is going toward materials, and labor. Contractors asking for a smaller deposit may like to make claims, but taking a smaller deposit upfront doesn’t necessarily make them more trustworthy. Like many things on this list, asking them so you can understand their process may offer useful insight. There’s nothing wrong with inquiring about where your money is going, so do not be afraid to ask.

Ask about their process, and for a walkthrough of your upcoming experience with them.

Reputable contractors and businesses have a client on-boarding process. Talk to your potential hire about their process. What should you expect? What will they do with the deposit? How long does a material order usually take? Answers to these questions will help you get an idea of all of the things that tend to happen “behind the curtain”. It’s all too familiar when you hand over the deposit check and don’t hear from the contractor for a few weeks until it’s time to schedule the installation or work. What goes on between handing over the deposit check and the first day on-site is important. Reliable communication is key to a positive experience working with a contractor.

Ask for references from the last six months. 

I’m sure you’ve already scoured the internet for reviews of someone you’re thinking about hiring. Those are often good indicators but are often less informative than you’d like. It’s never a bad idea to ask for recent references. Call those references and ask any auxiliary questions you might not have been able to glean from online reviews. Previous clients who were satisfied with the work will usually be more than happy to elaborate on their experience with the contractor you’re thinking of hiring.