Princeton Capital Blog

How to Hire A Contractor: Five Important Steps

August 1st, 2012

Whether remodeling or making more simple home improvements, it is vital to find the right contractor. Times are tight, and horror stories about lingering projects abound. These five steps, outlined by the San Jose Mercury News, will help you hire the perfect contractor that you can trust to improve your home.

Step One: Get referrals

While there are many ways to find contractors, an easy way to start is simply asking friends and family about it. Put the question out to your contacts on Facebook, and a friend may refer you to a fantastic and trustworthy contractor.

Online sites such as Angie’s List, which requires a subscription fee, provide reviews of local contractors among other small businesses.

Step Two: Interview potential contractors

Prepare to ask the candidates questions about their professional background, recent experience with similar projects, their workers, professional associations, and obtain a list of references. Be sure to follow through and call all of the given references!

Step Three: Look for red flags

Contractors offering extremely low bids could be cutting corners with cheap labor and substandard materials. While times are difficult for many, the cheapest bid is not always the best.

Other red flags include asking for too much cash up front – more than a third – or demanding to be paid only in cash.

Step Four: Narrow it down

From those you have interviewed, narrow it down to three candidates and call all of their references. Ensure that those projects were completed on time and at the expected price. You can also check on your candidates with the Better Business Bureau for former complaints.

Meet with the three candidates face to face, and ask for a broken down price estimate that shows materials and labor expected.

Step Five: Finalize the deal

Once you have chosen your contractor, get the agreement down in writing! This is crucial if any problems should arise later on. The Mercury recommends including the “beginning date, a completion date, and how payments will be made. It’s typical to pay a third up front, a third when the project is half done and the final third once the job is done and meets your expectations.”

Also ensure that the contractor has a certificate of insurance showing liability and workman’s compensation insurance in case of an accident.

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