Hiring a Contactor

Grand Building and Remodeling wants you to be well informed about what to expect as your project moves from concept to completion. We want you to be involved with your project and to understand the steps that will be taken as the project develops. Toward that end we have added the following checklist of actions that you need to take when hiring a contractor. The majority of following information is based upon a document entitled Hiring a Contractor – Consumer Information ( https://www.consumer.ftc.gov/articles/0242-hiring-contractor ) from the U.S. Federal Trade Commission.

Do Your Research

Check with friends, neighbors, or co-workers who’ve used a contractor
If you can, look at the work done and ask about their experience.
Look at sites you trust that post ratings and reviews
Do people seem to have similar experiences, good or bad? You also can check out a contractor’s online reputation by searching for the company’s name with words like “scam,” “rip-off,” or “complaint.”
Find out how long they’ve been in business
Look for an established company whose record and reputation you can check out.
Check for qualifications, like licensing
Arizona requires contractors to be licensed and bonded. Check with the Arizona Registrar of Contractors Contractor Search ( http://www.azroc.gov/roc/contractorsearch.html) to see if the contractor is insured, bonded, and if there are any outstanding complaints. Licensing can range from simple registration to a detailed qualification process. Make sure the contractor’s license is current.

Before You Hire a Contractor

Get Estimates
Once you’ve narrowed your options, get written estimates from several firms. Don’t automatically choose the lowest bidder. Ask for an explanation to see if there’s a reason for the difference in price.
Ask Questions
How many projects like mine have you completed in the last year?
Ask for a list so you can see how familiar the contractor is with your type of project.
Will my project require a permit?
Most states and localities require permits for building projects, even for simple jobs like decks. A competent contractor will get all the necessary permits before starting work on your project. You may want to choose a contractor familiar with the permitting process in your county, city, or town.
May I have a list of references?
A contractor should be able to give you names, addresses, and phone numbers of at least three clients with projects like yours. Ask each client how long ago the project was and whether it was completed on time. Was the client satisfied? Were there any unexpected costs? Did workers show up on time and clean up after finishing the job? You also could tell the contractor that you’d like to visit jobs in progress.
What types of insurance do you carry?
Contractors should have:

• personal liability
• worker’s compensation
• property damage coverage

Ask for copies of insurance certificates, and make sure they’re current, or you could be held liable for any injuries and damages that occur during the project.
Will you be using subcontractors on this project?
If so, make sure the subcontractors have current insurance coverage and licenses, too, if required.

Understand Your Payment Options

Try to limit your down payment
Some state laws limit the amount of money a contractor can request as a down payment. Contact your state or local consumer agency to find out the law in your area.
Grand Building and Remodeling never asks for a down payment.
Try to make payments during the project contingent upon completion of defined amounts of work
This way, if the work isn’t going according to schedule, the payments to your contractor also are delayed.

Get a Written Contract

Contract requirements vary by state. Even if your state doesn’t require a written agreement, ask for one. It should be clear and concise and include the who, what, where, when, and cost of your project. Before you sign a contract, make sure it includes:

• the contractor’s name, address, phone, and license number (if required)
• the contractor’s obligation to get all necessary permits
• how change orders are handled. A change order is a written authorization to the contractor to make a change or addition to the work described in the original contract and could affect the project’s cost and schedule.
• a detailed list of all materials including each product’s color, model, size, and brand. If some materials will be chosen later, the contract should say who’s responsible for choosing each item and how much money is budgeted for it (this is also known as the “allowance”).
• information about warranties covering materials and workmanship, with names and addresses of who is honoring them — the contractor, distributor, or manufacturer. The length of the warranty period and any limitations also should be spelled out.
• what the contractor will and won’t do. For example, is site clean-up and trash hauling included in the price? Ask for a “broom clause” that makes the contractor responsible for all clean-up work, including spills and stains.
• any promises made during conversations or calls. If they don’t remember, you may be out of luck — or charged extra.
• a written statement of your right to cancel the contract within three business days if you signed it in your home or at a location other than the seller’s permanent place of business.
• Ask for a Lien Release at the completion of your job in order to ensure that all vendors and subcontractors have been paid.

After You Hire a Contractor

Keep Records!
Keep all paperwork related to your project in one place. This includes:

• copies of the contract
• change orders
• any correspondence with your home improvement professionals
• a record of all payments. You may need receipts for tax purposes.

Pay Wisely
Don’t make the final payment or sign an affidavit of final release until you’re satisfied
Besides being satisfied with the work, you also need to know that subcontractors and suppliers have been paid. Laws in your state might allow them to file a mechanic’s lien against your home to satisfy their unpaid bills, forcing you to sell your home to pay them. Protect yourself by asking the contractor for a lien release or lien waiver.
Use a Sign-Off Checklist
Before you sign off and make the final payment, check that:

• all work meets the standards spelled out in the contract
• you have written warranties for materials and workmanship
• you have proof that all subcontractors and suppliers have been paid
• the job site has been cleaned up and cleared of excess materials, tools, and equipment
• you have inspected and approved the completed work

Signs of a Home Improvement Scam
How can you tell if a contractor might not be reputable? You may not want to do business with someone who:

• knocks on your door for business or offers you discounts for finding other customers
• just happens to have materials left over from a previous job
• pressures you for an immediate decision
• only accepts cash, asks you to pay everything up-front, or suggests you borrow money from a lender the contractor knows
• asks you to get the required building permits
• tells you your job will be a “demonstration” or offers a lifetime warranty or long-term guarantee
• doesn’t list a business number in the local telephone directory

The Home Improvement Loan Scam
Here’s how it works: a contractor calls or comes to your door and offers a deal to install a new roof or remodel your kitchen. He says he can arrange financing through a lender he knows. After he starts, he asks you to sign papers; they may be blank — or he might hustle you along and not give you time to read through them. Later you find out you’ve agreed to a home equity loan with a high interest rate, points, and fees. What’s worse, the work on your home isn’t done right or isn’t completed, and the contractor — who may already have been paid by the lender — has lost interest.
To avoid a loan scam, do not:

• agree to a home equity loan if you don’t have the money to make the payments
• sign a document you haven’t read or that has blank spaces to be filled in after you sign
• let anyone pressure you into signing any document
• deed your property to anyone. Consult an attorney, a knowledgeable family member, or someone else you trust if you’re asked to.
• agree to financing through your contractor without shopping around and comparing loan terms

Grand Building and Remodeling wants you to be well informed about what to expect as your project moves from concept to completion.

Grand Building and Remodeling
11617 W Grand Avenue
El Mirage, Arizona 85335
Phone: 623-583-0644
Fax: 623-583-9329
Arizona ROC Licenses: 093203 / 247148