Hiring a Contractor: Steps to Take

You have just purchased a home that needs repairing, or maybe you are contemplating renovating your house or apartment. Remodeling your home will probably be a major expense, and you want to make certain that everything runs smoothly, and the work is done according to your specifications. Surprisingly, when it comes to hiring someone to do work in their home, many people will choose to take short cuts and become penny wise and pound foolish. The next thing you know, a complaint is filed against the contractor, or the worker refuses to finish the work, or he or she will disappear and is never heard from again. Whether you are hiring someone to perform a small or major job, there are several precautionary steps you should take before handing over your hard earn cash to a contractor.

Make certain the contractor has a license, insurance, a clean complaint record, a good reputation with local suppliers and satisfactory endorsements from previous customers. Although each state may have different laws regulating contractors, if you live in New York, you can contact the Consumer Affairs Office to check if the worker is licensed. If you hire someone who is not licensed to perform certain jobs, you may not have any recourse if the work is not performed to your requests or does not meet your city or state laws.

Have a contract drawn up providing the total cost and a punch list of every job that has to be done. Know who is going to be responsible for doing the work, the number of workers assigned and the person who will be overseeing the job. Make certain that you and the contractor go over the contract thoroughly, and it is signed by you and the contractor. If there is a deadline that must be met, make sure it is spelled out in the contract; the words time is of the essence should be on the agreement. You may want to write the following phrase: The work must be completed on a specified date; for each day the work is delayed, a set amount per day will be deducted from the final payment. This may not cover unavoidable emergencies or unforeseen acts of God. We are talking about workers who will decide to leave the work undone for months to go work on someone else's home because that job is bringing in more money for the contractor.

Never pay the total amount upfront. You can pay one-third before the work begins, another one-third during the work in progress and the final one-third upon completion of the job. Many experts suggest not giving a deposit up front. If the contractor is reputable, he or she will be able to purchase supplies on credit. Depending on the type of job being done, many contractors will let the customer buy the supplies.

Do not make payments without first getting a release of lien. A contractor can seize your property if you fail to make payments.

Always read a contract before you sign it. If something in the contract is not understandable, ask for a thorough clarification. If the explanation is not to your satisfaction, seek legal advice. The amount of money you pay a lawyer will be very little compared to the amount of cash you will lose if the contractor is deceitful.

And last but not least, pay by check or money order, but if you must pay in cash, get a written receipt. Cash should never leave your hands without getting proof of payment.