How to Find a Reliable Contractor for Your Next Home Improvement Project

by on April 2nd, 2015
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In these tough economical times you have to be very careful when hiring a contractor to do work on your home. The home improvement industry has passed auto sales as the biggest source of consumer complaints, according to the national association of consumer agency administrators. So what does that mean to you? Well, in laymen’s terms, 96% of all contractors fail, basically, that’s an automatic failure.

With Home Improvement statistics of failure in the 90th percentile, how do you safeguard yourself from not becoming a victim and getting ripped off?

Well the first thing is to always remembered if it seems too good to be true, it probably is. A contractor who promises you the world will more than likely take more from you than give.

To better protect you and your family, here are the biggest traps now being set by inept or tricky home contractors and builders and how to defend yourself…

Trap #1Charging way too much. It is a known fact that many contractors will increase the price of a home improvement job depending on where you live. If you live in an upscale neighborhood, you can best believe that contractor will add 20-30% of the cost of what he would originally charge. His theory, if they can afford to live here, they can afford to pay a little more towards their home remodeling.

How to protect yourself – When calling to make an appointment, tell the contractor what you are looking to get done and nicely ask for a ball-park price before you give out your address. From there, at least you have an initial idea of what his fee may be.

Trap #2 – Contractors who substitute materials. Even if you verbally discuss the materials you want, some contractors may substitute cheaper ones, usually for a higher payout on their end. In some cases, substituting can be dangerous. A woman in Chicago, Illinois hired a contractor to install copper pipes in her home, but instead he installed plastic pipes. The results, that winter, the pipes began to leak and eventually burst. And you can best believe that contractor was nowhere to be found.

How to protect yourself – When negotiating your contract with your contractor, let him know you would like receipts of all the material that is purchased for your project. Then be sure to review them.

Trap #3Paying money upfront before the work begins. By law it is illegal to pay more than 10% upfront for your home improvement job. Unfortunately a fact that many consumers do not know, and because of this, a large percentage of contractors will take full advantage of your “home improvement” ignorance. A typical scam is for the contractor to take 10-50% of your money up front for materials they haven’t bought – or for work they haven’t yet done – and then go on to another job. When that happens, more than likely they will never return, as well as change their number and maybe even change the company’s name.

How to protect yourself – Never pay a contractor completely for work that has not been done. Always keep at least 50% – to ensure they will be back to complete the work.

Trap # 4 - A contractor who neglects to pay his subcontractors. This is probably the most unknown trap in home improvements industry. If you pay your money directly to your contractor, in which most consumers are told to do, and the contractor neglects to pay his subcontractors that he hired to help with the job, those subcontractors can come after you for their money owed. They can quickly put a lien on your home, which could make it impossible to sell or even re-finance. In the end, you end up paying for the same job twice.

How to protect yourself – Before you sign anything with your contractor, make sure you insist on getting lien waivers from all the subcontractors on the job. If the contractor is unable to grant you the waivers, at best, get a restrictive endorsement – which can be a separate document or stamped on the back of the checks you use to pay subcontractors. You can obtain such wording from any bank or saving and loan that makes new-construction loans. Last but not least, pay all the subcontractors directly after receiving their lien waivers in writing.

Despite what you’ve read, there are actually reliable contractors to be found in the home improvement industry, although, it does take a bit of investigating and homework on the consumers part. Don’t just throw money at the first contractor that tells you what you want to hear, because the likely hood that he is just blowing smoke up your… is probably true. Get referrals, scope out companies that have been in business for over 20 years, but most importantly, don’t be naïve. If it seems too good to be true, then, well you know the rest.

Venturing on a home improvement on your home can be an exciting and fulfilling endeavor if you work with a good contractor. Working with a bad contractor can make it a living hell. But always remember, investing in the improvement of your home is just that, an investment.

The money you use to improve your home may be your saving, or personal stock investments, retirement fund or even just your hard earned paychecks. So if you really think about it, are you willing to just give that money over to a contractor in “hopes” he will do a good job? Why not give it to a reliable contractor who “will” do a good job. Because at the end of the day, you have to ask yourself the most important question of all – CAN YOU AFFORD TO GAMBLE?

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