(1) Your Contractor should carry general liability insurance. Avoid doing business with any company that is uninsured. You may be held liable for any potential injuries and damages that might occur during the course of any project.
(2) Comparison shopping should be based on, reliability, reputation, experience and price-value, not just the lowest price of all proposals presented.
(3) When comparing estimates, make sure each one is based on (a) same scope of work, (b) same set of specifications, (c) the same set of plans. This is especially true with major investment projects in the $50,000-$250,000 range (i.e., major remodeling, re-roofing, window & siding replacement, and the like).
(4) A well-written contract should include the contractors name, address, phone and license number, if required for that specific trade. The contract should also specify (a) payment terms, payment schedule for the contractor, subcontractors (if any) and suppliers, (b) an estimate start and completion date, (c) the cancellation policy (if applicable), (d) how change orders will be handled. The contract should spell out what will and will not be performed.
(5) In many circumstances, oral contracts are as enforceable as written agreements. Oral contracts related to real property are an exception to this rule. Therefore, it is always best to get verbal agreements added to your original written contract or agreement.
(6) Avoid door-to-door salespersons or work crews. Many companies have very specific door-to-door marketing and sales plans and strategies, which many times are designed to `close you' that day. You need time to check out contractors you do business with and make certain they are legitimate.
(7) Pay contractors by check or credit card. Avoid on the spot cash payments. In fact, avoid all cash payments, as there is no paper trail of payment to protect you. If a representative of a company or even a manager of a company requests any form of cash payment, this should be a major 'red flag' of caution to you as a consumer.
(8) Never pay the full price upfront and make sure the contract spells out the payment schedule. Never sign over an insurance check to a contractor until the work is completed.
(9) Protect your home and valuables by locking up or securing all valuables and always monitor workers in your home while they perform work.
(10) Do not help contractors or their workers and do not lend them your tools. If a worker is hurt while you are assisting (e.g., holding a ladder) or is hurt using one of your tools, you may be liable via a 'tort claim' by the worker or contractor.
(11) A change order is a written agreement to change the work described in the original contract. It could affect the project's cost and schedule. For example, remodeling contractors require payment for change orders before the work begins.
(12) Lien laws may allow unpaid subcontractors (if used by the primary contractor) or suppliers to 'attach' your home through a “construction lien.” That means potential subcontractors and/or suppliers could go to court to force you to satisfy their unpaid bills from your project. Protect yourself by asking the contractor, and any potential subcontractor, for a lien release or lien waiver.
(13) Check the progress of the work and do not make the final payment until you are satisfied with the work and the contractor has furnished proof that all subcontractors and construction liens have been paid off.
(14) Be sure that the contractor or company agrees in writing that all work will conform to city, county and/or state building codes and protocol.
(15) Always hire companies that you can communicate with and have a permanent office address. You want an established company with an office you can go to if you ever need personal contact. Check out the address and how long they have been in the area.
(16) Require that any company representative (regardless of service category) consulting with you on your job, service or project, completely understand every detail about their product and services, product features and benefits, installation specifications, warranty information and the like.
(17) Have all parties that will be involved or have an interest in the project at the initial consultations. Once the decision is made, determine the key contact person with whom the contractor will communicate.