Any type of home renovation project can be an empowering and fun process. But some jobs truly are better left to the professionals. You may need to knock down a wall to have room for a kitchen island or create more space by adding a finished basement to your home. Whatever big project you have in mind, turning to an expert can be a great idea.
The right contractor can handle everything, from sourcing materials to ensuring the renovations meet security and regulatory standards. This guide will help you find a trustworthy contractor to bring your vision to life.
Key takeaways:
- Do your research and ask for referrals to find a reputable contractor with relevant experience and positive client feedback.
- Verify all contractor credentials and insurance coverage to protect yourself from liability and ensure the contractor is qualified to handle your renovation.
- Gather multiple estimates before signing a contract so you can compare pricing, portfolios and services to make an informed decision.
How To Hire A Contractor In 7 Steps
You have the project in mind when you’re on the hunt for a contractor. How can you ensure you find the right expert for the job? Here are seven steps you can take.
1. Decide On The Type Of Contractor You Need
There are general and specialty contractors, and there’s a significant difference in their roles on a project. General contractors are responsible for overseeing a construction assignment. Instead of completing the work independently, they hire subcontractors who complete the projects. Essentially, they supervise and manage large-scale assignments to ensure the job is done efficiently.
Specialty contractors are experts at completing specific projects. Plumbers, electricians, carpenters, floor layers, roofers and HVAC technicians are considered specialized contractors. If you want minor to moderate work done, like installing new plumbing or knocking down walls, it might be best to hire a specialty contractor.
2. Establish A Renovation Budget
Creating a remodel budget is a crucial component of any renovation plan. Consider obvious things like materials and labor, but also include the cost of any required inspections, as they’re essential to ensure a renovation complies with local codes.
You should also establish how you would finance the project, whether from your personal savings or tapping into your equity to do a home equity loan or cash-out refinance. Make sure you have everything laid out ahead of time to minimize your chances of going over budget.
3. Seek Referrals And Recommendations
Ask your friends, family, co-workers and neighbors if they know of contractors who can do the job. If you have a trusted real estate professional you’ve worked with in the past, they may also be able to point you in the right direction. Thanks to the internet, you can also search for reviews online.
When evaluating potential contractors for the job, assessing their professionalism and communication skills is important. The following questions can help you gauge their experience, reliability and ability to manage the project effectively:
- Are you licensed and insured?
- Can you provide images or examples of past work?
- Can you provide client references or a list of past clients?
- Are you open to providing financial references from suppliers or banks?
- What types of projects do you have the most experience with?
- How many other projects will you be managing at the same time?
- Do you typically handle projects of this size and scope?
- How long have you been working with your subcontractors?
- Do you offer flexible payment schedules?
4. Check Credentials
First, it’s essential to make sure the contractors you’re interested in are licensed and insured. Having the proper credentials could save you thousands if anyone is injured or anything is damaged!
To be more specific, you’ll want to ensure they have liability coverage and workers’ compensation insurance. Verify insurance certificates and consider consulting your insurance agent about adding the contractor as an additional insured on your homeowners policy for the project. You should also ask for photos from previous jobs and request a portfolio to see their completed projects.
5. Get Multiple Bids
Multiple bids can ensure you get the best value and quality for your home improvement project. This allows you to compare not only price, but everything from years of experience to extra services each contractor may offer. For instance, you might be quoted the same price from two contractors, but one might have a more interesting portfolio or offer outside services like securing the required building permits for you.
When reviewing bids, make sure you’re comparing identical scopes of work. It could be a potential strategy for contractors to omit certain details like demolition, cleanup, or materials in order to submit a lower bid and win the job. Always double-check that each estimate includes the same scope of work, materials, and services so you can make a truly informed decision.
A reliable contractor should also be well versed in the permitting process and handle the paperwork on your behalf. During the planning phase, discuss who will be responsible for obtaining permits and scheduling inspections to make sure the project complies with local building codes and safety standards. Having a few thorough, transparent bids allows you to choose the contractor that offers the best value for your specific goals.
6. Choose The Right Contractor For You
Now that you’ve considered the job you want done as well as price estimates, the quality of work and how you’ll pay for the work, it’s time to choose the right contractor. Be sure you consider your options carefully. Contractual work is an expensive, long-term investment, so you want to be sure that you choose a contractor that your future self will be happy with.
Communication is an essential part of managing any large home improvement project. Look for red flags such as reluctance to provide references, irregular licensing or insurance, pressure to decide quickly or unusually low bids. A reputable contractor should be able to provide financial transparency.
7. Establish A Payment Schedule
OK, so you’ve picked the best contractor for your project. Now it’s time to establish a payment arrangement. Usually, contractors don’t receive a lump-sum payment. Instead, a construction agreement is typically broken into progress payments that are made at regular intervals. For instance, you may come to an agreement that serves you with an invoice at the end of every month, with 10 – 20 days to pay the contractor.
Be sure to get any agreement in writing, and make sure the contract is written and signed by both parties before any work begins on the project. This protects you and the contractor by clearly outlining expectations, timelines and payment terms, reducing the risk of misunderstandings or disputes.
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Additional Tips For Hiring A Contractor
While you should follow the seven steps above when you’re looking to hire a contractor, here are a few extra tips to make the process go smoothly:
- Take your time: Home renovation is a long-term commitment, so take your time finding the right contractor, and avoid rushing to ensure quality work and fair pricing.
- Keep a project file: Tracking contracts, invoices, proof of insurance and all other project documents will protect you in case of mishaps.
- Hire local: Hiring local contractors supports your community and can help reduce travel-related costs. It also makes scheduling, communication and problem-solving quicker and more convenient. Local contractors often have strong reputations and trusted networks with area subcontractors.
- Consider insurance: Before starting your renovation, make sure you and your contractor have the right insurance coverage. A contractor’s liability insurance protects you from being stuck with costs if there’s an injury or property damage.
- Budget for unexpected costs: Plan for unexpected costs of up to 20% of the overall budget. Additionally, expect to make a down payment of 10% – 25% of the project cost upfront, and remember to wait until all the work is completed before making the final payment.
- Set clear communication expectations upfront: Before work begins, agree on how often and how you’ll receive updates, whether it’s a daily call at the end of the day or alerts only when issues arise. Miscommunication is one of the most common problems during home projects, so establishing a reliable communication plan is just as important as agreeing on the payment schedule.
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The Bottom Line
Hiring a contractor to complete the project of your dreams can be exciting, but it’s also crucial that you’re careful in your decision-making. Don’t rush and settle on the first (or cheapest) contractor you encounter. Instead, take your time and do proper research to avoid ending up with unsatisfactory or unsafe work.
Once you follow the above steps to find a contractor, you’ll be well equipped to trust the process. It all comes down to asking the right questions and doing the right research to find the contractor who’s the right fit for your project.
If you’re planning a larger renovation, financing might be the best option. Quicken Loans can to help you access your home equity and fund your project with confidence.
Ben Shapiro
Ben Shapiro is an award-winning financial analyst with nearly a decade of experience working in corporate finance in big banks, small-to-medium-size businesses, and mortgage finance. His expertise includes strategic application of macroeconomic analysis, financial data analysis, financial forecasting and strategic scenario planning. For the past four years, he has focused on the mortgage industry, applying economics to forecasting and strategic decision-making at Quicken Loans. Ben earned a bachelor’s degree in business with a minor in economics from California State University, Northridge, graduating cum laude and with honors. He also served as an officer in an allied military for five years, responsible for the welfare of 300 soldiers and eight direct reports before age 25.
