Sean King is the Best Selling Author of “The Ultimate Guide To Hiring The Right Contractor” and a 3rd generation home improvement expert. He is here to help us avoid making the 3 biggest mistakes when it comes to hiring a contractor.
How do you know the top two complaints with the Better Business Bureau target: General and roofing contractors? Everyone’s been burned by a contractor. Let’s face the facts. All right. We have help on the way. Shaun King is here. Shaun is the best selling author of “The Ultimate Guide to hiring the right contractor”. And we’re gonna start first. Good to see you. Thanks for having me. You have three things that are so important, to begin with. So let’s go through them. OK.
The number one mistake people make is Today you need to prescreened your contractor with the technology available to us. Jump online check them out at Angie’s List, BBB, Google and Yelp. We need to pay special attention to how they handle resolve any of their complaints so. So when things are going well you can’t judge it. Well, that went well. Everything’s going great. Everyone’s a great guy. It’s when the chips are down that’s when you know who you’re doing business. Everybody is going to show up somewhere and if they don’t show up somewhere online. Huge Red Flag, OK. Huge Red Flag. You can find them. They’re going to find more than you even want to know about some of these guys.
All right. Next one is: Get it in writing . Let’s get it done right. Right. A hugely important you need to get it in writing right from the start. That way if there’s an issue down the line whether it’s a legal issue or something else you’ll be prepared you need to have your case to present if there is an issue. What does that mean, Get in writing? Get like you. I’m going to fix your door for you need an extremely detailed contract, very word. You want to get involved don’t just accept their template, crank out the red marker and say I’ve got to change out, I got to add this. If they’re not willing to accommodate you move on to the next candidate.
Maybe most important is: Getting ahead of your payment schedule and this is where a lot of people blow it. It’s the most common mistake we find. You need to establish a specific payment schedule prior to starting the job. But as the homeowner, it’s up to you to stick to it as soon as you get ahead on payments. All bets are off. You’ve lost any control of leverage you may have had. He’s not going to determine when or even if your project gets complete. You give him all the money, Steve.
If he’s not come in behind him in front he’s got the money in the pocket so he might be doing other job. That’s exactly, where he is. He’s running around picking up trash. So common sense, really that’s competent. So they run this by well I need the money from me for the materials. Thats Huge Red Flag. If they cannot afford to fund your project, they have no business bidding your project. That is my mantra. OK. So you don’t give them a dollar. Correct, we don’t take a dime until the hundreds and job completion of my complete. Not one dime, not a dime. But there are some different ways to do it though you can maybe give 50 percent! Correct! There are different ways to deal sure. Here’s the thing. Well you got to get involved in the payment structure if they say, “Hey, I’d like half down upfront and then I need 30 or 40 percent when I get started and then 20 percent when I’m done.” I give him 80 percent of the money hasn’t done anything yet. So as Steve mentioned give him 10 percent down. Make small stage payments. Here’s the key. You need to maintain at least 50 percent of the project money back until it’s a 100% completed.
All right! What else do you have out. Well what other tips do you have here is : Your friend referral.
That’s the best place for such a contractor searching for their friend, someone you know and trust. If they had a positive experience, odds are you’re going to have a positive experience. Word of mouth is huge in construction. All right but there’s always gonna be something wrong. Right, I mean no one it’s going to be one that my that’s great is it everything a hundred. Here’s the thing, you need to reach out to some of the previous customers. Find out they were happy with the process, that they love the finished product. Here’s the million dollar question. Would they hire him again if they don’t immediately say “Yes”? You need to move on to the next candidate. Would they hire someone again?
Reach out and talk to people. That’s very important now is: A lot of people will show you a photograph of their work. That’s not enough? Not near enough, Steve. Here’s the thing, you need to actually jump online and check them out the California State Contractors Board. You need to know that they are properly licenced and insured to perform whatever work you need to have done. Here’s the thing. You hire the wrong guy. Not only can it cause you tens of thousands of dollars, you can actually lose your home. Family back east actually hired a contractor to put a roof on. He was not properly insured to do roofing work. Unfortunately, he still took the job. And one of his workers tragically fell and died. His widow then sued the contractor and the homeowner they lost their home to the widow in the settlement. That’s crazy.
So how do you guarantee that they have the insurance? The state contractors board here in California. You can jump online under the Website and you can see exactly what they’re covered for, exactly what type of insurance they have. Critical information! They give you a number, something!? There is. They’ll tell you who their actual carrier is or their agent isn’t and you’re better off not just trusting the site, make a phone call and say, “Hey, is their insurance up to snuff? Maybe it was when the site was last updated.” Do you want to go see their work? When you reach out to some previous customers. Those that say they would hire them again then it’s a great time to ask, “Hey would you mind if I swung by as I’m also doing it.” And we mentioned the payment structure. Be smart about the payment structure so let’s not let them bully you because they do have a tendency. They do they come in it’s. That they’ll tell you this is how I do it. Well, it may be how they do it but it’s not how you do it.
All right. There’s a payment structure. You’re saying 50 percent down you even recommend going lower if you can. That’s what it would add to the bad structure. You know you want to go with a much better structure which I think has to be the next like 10 percent down price payment. And hold that half until the end. It’s the only way you maintain any control and voice your concerns. At the first sign that you’re products going sideways, you need to speak up let them know your concerns and that it needs to address them immediately. Because sitting quietly by, kind of hoping, it’ll work itself out in the end, is not a plan. This is your castle. You need to protect it. Don’t be naive. This is not about being nice.
All right let’s review your tips for hiring the right contractor here they are:.
- Referral from friends.
- Reach out to previous customers.
- Require proof.
- Set a payment schedule and.
- Voice your concerns.
Don’t be afraid to say, “Hey, Listen! this tile right here is chipped.” Correct! You need to speak up and let them know. Don’t let him run you.
“The Ultimate Guide to hiring the right contractor”, We have these tips by the way on our Website. Shawn pleasure. Great to be here. Thanks so much for having me.
Some Frequently Asked Questions
- File IRS Form 1099-MISC telling the IRS (and your state tax agency) how much you paid the worker.
- Get the independent contractor’s taxpayer identification number. If they don’t have one, you need their Social Security number.
- Get Multiple Estimates. Talk to several contractors and get written estimates from at least three.
- Hire Local, Licensed Contractors Whenever Possible.
- Check Their Past Work.
- Take Your Time Making a Sound Decision.
- Check Their Insurance and Bonding.
- Get Everything in Writing.
- Understand Your Right to Cancel.
- Don’t Pay Up-Front.
Yes, he needs money to get the project started, but asking for more than 15 percent raises a red flag, and most states allow contractors to ask for a maximum of 33 percent of the total cost up front [source: Chicago Tribune]. Your contractor should have enough credit to pay the rest of the up–front costs.
- Stop paying. Many contractors ask for half of their payment upfront before they begin a job.
- Complain. Because you hired a licensed contractor, you can file a complaint with the government agency that licensed them.
- Tap their bond.
- Go to arbitration.
- Take it to court.
- Seek government compensation.
Here are seven warning signs your contractor might actually be an employee under the law: You define the work hours: Generally, independent contractors do the job as they see fit. They set their own hours and work how and when they want. And they should be paid by the project — never on an hourly basis.
- Avoid Allowances.
- Establish Good Communication.
- Keep a Project Journal.
- Track All Changes in Writing.
- Check the Work.
- Pay Only for Completed Work.
- Be a Good Customer.
The contractor needs to supply this, or the homeowner can pay it directly to the supplier. But in all other cases, it’s not wise to pay upfront money. If a contractorasks you for a deposit like this, be prepared to ask these honest questions: … Yourcontractor may be in a cash bind for any number of reasons.
Paying contractor cash. Although paying cash is not the best option, you can make it a little safer by signing a contract or a “receipt” with each cash transaction. In general, it is usually not a good practice to pay cash up front.
Breach. You must show that the party you plan to sue failed to meet his or her contractual obligations (“breach of contract” in legalese). This is usually the heart of the case – you’ll need to prove that the contractor failed to do agreed- on work or did work of unacceptably poor quality. Damages.
*The information above does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of a qualified attorney.