Woman creating a real estate project outline

1. Put together an outline of your project

It’s best to know what you are wanting before you start asking for bids. You will get the most accurate estimates if you can clearly outline your vision for the project and list any specific materials you wish to use. A good contractor will review your requirements and provide a cost breakdown as part of their bid.

Couple researching contractor credentials2. Research your contractor’s credentials

Before and during your meeting with a contractor, find out all you can about their qualifications and experience. Visit their company website and social media accounts, check their references and look at examples of the contractor’s past work.

Many contractors are members of national or local trade organizations that bind them to a strict code of ethics, training, or both. While not required, they are a plus for your contractor to have.

Example proof of insurance document3. Make sure that the contractor is fully insured

Any company that you hire to work on your property should have General Liability Insurance coverage, which covers the contractor for accidents that may occur during the job. If a contractor does not have insurance, and a worker gets hurt on your project, or an accident causes damage to your neighbor’s property, you could be liable.

Contractor working on project4. Ensure that the contractor you pick specializes in your project type

Research and interview contractors to make sure they have experience doing the type of work you need done. Many types of projects are regulated and have code requirements, so you want to ensure that the company you hire does the job right, and to code, the first time. You want your contractor to be able to anticipate the nuances of the work, which will enable them to address potential issues ahead of time and perform the work correctly.

Example construction project outline5. Make sure you are provided with a detailed outline of the work to be performed

Contractors should provide this in their estimates or attach them to your contract. This is important to have in case you or your contractor need to make changes to the original scope of work partway through the project.

If changes to materials or budget are required partway into the project, make sure that these Change Orders are documented and signed off on by both parties prior to the work being done. This will ensure that there will be no question as to whether a change (and its resulting cost) was agreed to.

Signing a contract6. Sign a Contract before starting on a project

The contract should clearly outline the project in full detail, to include labor & material costs, payment schedule, project start dates and completion dates and include the builder’s residential disclosure statement. Thoroughly review the contract before you sign.

Three Day Right of Rescission Form Example7. Look for the three-day right to cancel

The contractor is required by law to provide you with a verbal & written notice of your 3-day right to cancel the contract. Known by many names such as the “3-day cooling off period”, “3-day right of rescission” or the “3-day right to cancel”, this requirement gives the customer the right to cancel the contract, for any reason, within 3 business days after they sign.

Example Lien Release Clause8. Ask the contractor to provide a lien release

This is a clause that protects the homeowner from any mechanics liens. If your contractor uses subcontractors for any part of the job (i.e. electricians, plumbers, etc.), and fails to pay them, those subcontractors can put a lien on your property even though you may have paid your contractor in full.

Pressure to sign graphic9. Don’t give in to high-pressure sales tactics

Beware of contractors that employ high-pressure sales tactics, such as pushing a “temporary” low rate, or they pressure you to sign the contract right away before you have a chance to read it. Always do your due diligence, ask questions and read the contract before you sign and make sure you feel comfortable with them before moving forward.

Image of check and pen10. Make all payments directly to the company & always get a receipt

If someone asks you to put their personal name on a check rather than the company name, that is a red flag. Make sure all payments are made out to the company itself to help ensure that there are no future disputes about payments being received.

Avoid paying with cash since there is no paper trail with that method of payment, and it can be difficult to prove that payments were made.

We hope you found these tips helpful. Remember, get everything in writing and ask lots of questions. A little extra time spent now, could help ensure a job well done.