Guide: Choosing a contractor
This post really can be interchanged with any forum but here goes...
Let’s face it… you can’t always do it yourself. Some times you will need to hire a professional home improvement contractor. They are not all the same and the following paragraphs will help you choose the right one!
The first thing is choosing who to come out to your house and provide you with estimates. You can find contractors many ways. I suggest asking friends if they have had any similar work and who they used. I also suggest asking the Better Business Bureau for someone local. There are referral services, especially on the internet, that pre-screen their contractors. There is always the Phone book, if the first suggestions don’t pan out.
When you are calling for an estimate, ask if they offer free estimates. Most contractors will give out free estimates. Call several contractors. Your goal is to at least have three estimates to choose from when making your decision. When contacting a contractor for an estimate you will need to qualify them. Ask if they provide the service you need. Ask if they have liability insurance and workman’s compensation. Ask if they have a license, if required in your area. If they answer No to ANY of these requirements, thank them for their time and move on.
When speaking with contractors, either in person or over the phone, you should take notes. Use a separate sheet of paper for each contractor’s notes so you don’t become confused who said what. If you don’t understand something, swallow your pride and ask for clarification on the topic. Tell the contractor your goals for the project and ask his advice of the best way to achieve those goals.
Ask for an estimate from the contractor. Always demand this estimate in writing. Ask the contractor to include any statements he may have verbally made such as, “this will last ten years” or “we apply two coats”. Your written estimate should be detailed. If you have a question, ask. If you want a revision then ask for one. This estimate will become a binding contract once you sign it. Leave nothing to interpretation.
It is important to not allow the contractor to sell you on the spot. You need time to compare his estimate to your other estimates and do some research. Always obtain at least three estimates. I suggest more than three if you have the time. When comparing the estimates look at more than price. Price is the last thing you should be concerned with because it’s not what you pay it’s what you get. Contractor ABC may be trying to sell you a poor quality job for a high cost, while Contractor XYZ may be trying to sell you a high quality job at a moderate cost. You have to compare “scopes of work”. This is why you need a detailed estimate. You can not make a decision until all contractors are bidding for the same scope of work.
Always ask for proof of insurances and licenses. If the contractor has them he should have no problem providing them to you. This is not an option, always insist on written documentation. Always ask to see similar work. Don’t settle for pictures, demand addresses. Ask to speak to past customers.
Investigate, Investigate, Investigate. The Attorney General of Illinois lists home improvement contractors as the 3rd most complained about industry in Illinois. This is because home owners make un-educated decisions based on lowest bidder and are upset when they find out why the bid they choose was the lowest. Call the insurance company listed on the certificate that was provided to you. Make sure the policy hasn’t lapsed. Call the state licensing board. Make sure the license wasn’t revoked or forged. Drive by these addresses and take a look, if it’s exterior work. Check with the Better Business Bureau, Attorney General, Chamber of Commerce or any affiliations local contractors may have and ask if the contractors have any complaints.
Now you know you are dealing with reputable contractors. Now you know all contractors are bidding to do the same work. Who do you choose? Do you think it is safe to go with the lowest price? Maybe; But who has the better warranty? Who has more experience with this type of work? Who took the time to really make sure you understood the process? Who do you feel more comfortable speaking with? Do you have a hard time contacting any of these contractors? If you have a hard time in the sales process, image the response (or lack of response) you will get if you make a warranty claim!
How far apart are these proposals in price? If they are all essentially the same scope of work by legitimate contractors then they should all pretty much be in the same ball park money figure. If not, you have to ask yourself why.
After you have qualified all of your potential contractors, you know they are all worthy of your business, the contractor that earns your business is the one you trust the most. TRUST.
Written by Grumpy on December 12, 2003
Grumpy is the online Persona for Thomas Kral, the founder of Reliable American, Inc. Reliable American is a firm specializing in roofing and remodeling. www.reliableamerican.us
The above information is Copyright 2003 Reliable American, Inc.
Thanks Grumpy, great information!
I'll post this in the HOW TO GUIDES tonight.
This DIY - How To Guide by Thomas Kral has been published and can be found here: Choosing a contractor
If you have any questions about this guide please post it here in this thread.
Very well written Grumpy. I just wanted to add a couple more items to it - actually just extensions of what you wrote.
In regards to the "Who to bid to" - you can also ask your architect.
As for "What to ask" - make sure you ask them about what other projects they have scheduled in the timeframe you are wanting your home built.
Follow that up with who, and how large the workforce will be on your home - go as far as getting names. Then ask what experience those people have had with your type of home. This will force them to really think about what they have scheduled and where these individuals will be at that time. I consider this line of questions the pre-qualification (as Grumpy does) and suggest making up a question sheet before you call them so you can ask the same questions of all the contractors - apples to apples.
I suggest never taking an estimate over the phone. A method that works very well for me is write up a scope of work for your selected contractors to bid. This way you will have apples to apples. I consider the "apples to apples" the most important part of the bid process. If you just say well here is my plans and specifications please bid it - it'll be pretty much impossible to compare prices. Each contractor will give you their bid in a different way .. one will have it on a napkin, another will have a form letter with a number at the bottom of it, and another will have it broken down into divisions or by major phase of the work (concrete, framing, etc). My suggestion is to give them a "bid package" that includes the plans and specifications, a scope of work (mostly this is for items over and above the plans that you would like included), the bid form that you want the bid provided on (your architect can help with the layout of this form), and an information form that they fill out with all license #'s, phone, fax, email, address, insurance policy #'s.
The scope of work should have items like "Provide all materials, labor, etcetc to complete the construction of the home per attached architectural plans and specifications, dated xx/xx/xxxx, drawn by Mr Architect, attached structural plans, dated xx/xx/xxxx, drawn by Mr Engineer, etc..etc." This way they can't come back on you for something that should have been included in the plans.
Take a second to talk about specifications - your architect should supply you with some type of spec for each item being installed in the home. If a full blow spec is not created then you could refer to a room finish plan where all the items are called out. So if you want a 50 year shingle made by GAF that's what you put in the specs or somewhere in the plans. If you don't specifically state what the material is you leave it open for interpretation and therefore have the chance of bidding apples to oranges.
Also include any administrative activities that they will need to perform like "a weekly safety meeting should be held with a form being provided to owner/architect showing attendees and subject", or "It is mandatory to attend a weekly coordination meeting", or "All OSHA guidelines will need to be followed as it pertains to fall protection". Anyway enough of that - all the details that are not on the plans and specifications should be outlined. In the cover letter of the bid package you will state the instructions to bidders that outlines the time and place the bids need to be delivered. You may also put a timeframe for interviews of the final x contractors will take place. I personally wouldn't put that in there but instead say "Final x contractors will be called, in a timely manner after the bids have been accepted, for a final interview." And then after all the bids have been accepted I would interview all the contractors regardless of price. Each one will have a different take on how they bid the job and some will have advice on items that maybe another contractor has missed and that's why their bid is higher or lower. All that will come out in the interview process. Again make up an agenda and keep it the same for all the interviews - apples to apples.
Also ask for a list of references to be included in the bid submission - then make sure to call all of them. Again make up an apples to apples comparison for the references when speaking with them. By now you should have a good sized file on each of the contractors to base a sound decision on.
As Grumpy states above you need to make sure and go through the interview process so you can see what you can Trust face to face. You will be working very closely with this company during the construction of your home and for awhile after it's done so you'll want to pick someone you can sit across the table from.
Now when you receive all the bids you should be able to scan straight across from one to the next sheet and see that they've all bid the same thing. If one doesn't include an item, either fill it in with an architectural budget or find the highest number from the other contractors and enter it. I will make up a bid tab that colates all the information from the scope sheet and puts all the contractors numbers into one sheet. This makes it very easy to review with your architect or other consultants.
That's how I do it anyway, for what it's worth.
Hatchet, though my guide was for choosing a contractor from building a new home down to changing out a single window, I was trying to be generic to cover the broadest scope.
I agree with everything you have brought up, very helpful advice!
Sorry about that - I tend to get carried away with bidding. It's such a huge part of what I do everyday - the company I work for drills it into you everyday on how to shed risk (aka CYA). I guess I don't blame them when you're dealing with 150million dollar projects.
Very good information, I wish to include the homeowner ask if a building permit is required and who pays for it. In my town it's a $ 700.00 fee for building with out a permit plus the permit fee
It is helpful that people have to practice security like in choosing someone that probably will enter at your house. Doing a background check or knowing the contractor license is really helpful to avoid scams and making your home at risk, well for me its not bad to investigate the person that will work for me either.
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