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Tips on Hiring a Contractor
This information is provided to
assist a homeowner in selecting a contractor.
Prepare & plan
It is important to know what you want so you can give a clear
picture to the contractor.
Be as specific as possible. Have an idea of the size of the
improvement, materials, appliances or fixtures and your price
range. Depending on the scope of your project an architect
may be needed to design the project. Visit showrooms, model
homes, and home improvement stores to see recent trends and
new products that are available.
How do I know who to call?
The most frequently used method to find a reputable contractor
is to ask a friend or others who have had work done for a
recommendation. Another source is building professionals (i.e.
architects, designers). Home improvement stores, lumber yards,
and home decorating stores may know reputable contractors
in the area. The phone book Yellow Pages and advertisements
in local papers may also provide the names
of potential contractors.
Meeting with potential contractors
It is easier to compare the contractor’s estimates if
the same written scope of work is used for each estimate.
A written, itemized estimate related to the scope of work
should be requested of each contractor. Additional items to
include in your discussion are:
• Who
is responsible for getting & paying for building permits
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Time frame for the project
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Responsibility for cleanup
and provision of a dumpster
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References
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Proof of insurance
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For comparative purposes
a minimum of three written estimates is recommended.
Making a decision
The contractor’s background and reputation should be
carefully checked. Be sure to
ask the references about the scope of work done, if the project
was completed in a timely manner, any problems that came up
and if they would hire this person again. Contractors are
only going to give references of people that were pleased
with their work- you might want to ask the reference how they
heard about the contractor. The local Better Business Bureau
(609-588-0808) and the Monmouth County Office of Consumer
Affairs (732-431-7900) can supply homeowners with reliability
reports on many area contractors.
Hiring a contractor
Once a contractor is chosen, a contract is required if the
home improvement project is in excess of $200. The contract
should include the following information:
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Legal
name & business address, contractor’s name,
address, phone number and State license number
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Estimate start and completion
date
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Financial
terms (total price, payment schedule, method of payment,
finance charges and cancellation penalty
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Details of the contractor’s
responsibility (i.e. cleanup, providing dumpster protection
of personal property)
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Description of work to be done
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Specification of all materials
and products to be used or installed including size,
color, model, year, capacity, brand, quality, grade,
and quantity
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Statement of any guarantee or
warranty with respect to products, materials, labor
or services
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Binding arbitration clause enable
disputes to be resolved quickly without costly litigation.
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Depending
on the scope of project you may want to have a lawyer
review the contract. Prior to accepting a contract, ask
to see a copy of the contractor’s certificate of
insurance to be sure they have workman’s compensation
and other liability insurance. |
Payments
Once hired, contractors need a percentage of the cost of the
project to purchase supplies, order appliance and pay for
permits and other construction costs. Generally, 15-20% of
the project cost should be adequate but this amount should
never exceed 30%. Many contractors set up a payment schedule
which requires payments to be made at set times or as the
actual work gets completed. Some contractors prefer to
link the payment schedule to inspections. Payment is then
made after the job passes certain specified inspections.
Final payment
It is important to hold the final payment for the project
until all aspects of the contract
are fulfilled. According to New Jersey State Law, final inspections
are required to be satisfactory completed before the final
payment is made to a contractor (NJ 13:45 A-16.2). If the
contractor is responsible for calling for inspections, request
copies of final inspections certificates prior to issuing
payment.
Complaints
The County Offices of Consumer Affairs can assist you resolving
complaints against contractors. You will need to contact the
office located within the contractor’s County. The Monmouth
County Department of Community Affairs can be reach at
732-431-7900.
Things to beware of…
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Price reductions or other compensation to be received
because the property will be used as a model |
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Misrepresentations that products or materials need
no periodic repainting, finishing or maintenance |
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Misrepresentation that
a special price or discount is being given because of
market survey or test, use of materials left over from
another job, or some other reason |
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Being asked for more than 30% of the project cost prior
to the start of the job |
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Hiring
contractors who go "door-to-door" or someone
you did
not contact
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It is the property owner’s responsibility to
ensure that inspections occur at specified times during
the construction process. You may have the contractor
call to schedule the inspections but make sure that
your contractor follows through. |
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You have to remain flexible during home improvement
projects. Inevitably something unforeseen always seems
to happen. However,
be sure that any changes to the contracted scope of
work are agreed
to in writing. |
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