Beware of unlicensed contractors!
A fact sheet provided by your local government
If you are planning a home improvement project like a deck, a new bathroom, or a garage, you will probably need to hire a building contractor.
Not an easy task
There is no shortage
of building contractor horror stories. Almost everyone has heard tales of
damage, scams, shoddy workmanship, and builders who disappear in the middle of a
project. In fact, except for auto repair shops and car dealerships, no other
industry has generated as many complaints, according to the Council of Better
Business Bureaus. It would seem that finding a reliable and qualified contractor
is not an easy task.
You can put the odds on your side, however, by making sure you hire only licensed contractors.
While licensing isn't necessarily a measure of competence, it does imply a certain level of professionalism and suggests that the contractor is committed to his or her job. More significantly, licensing can protect you from a number of potential problems, such as the following:
Unlicensed usually means uninsured. If you use a contractor who is uninsured, it means the contractor has no way of reimbursing you for any property damage he or she causes. This means you end up paying the price. Likewise, if contractor carelessness leads to injury or damage to someone else's property, the problem is likely to become yours.
Con artists. Scams in the construction industry - especially in the home improvement business - have become almost legendary in the last few decades. Con artists posing as qualified contractors, and often targeting the elderly, have made national news any number of times. Even so, unwary homeowners continue to be taken in by these pseudo contractors, who often promise unrealistically low prices or use scare tactics to close the deal. In these cases, the homeowner typically ends up with either an incomplete or a low-quality improvement project - and several hundred, or even thousands of dollars less.
Even when a license is required, there is no guarantee that every contractor you encounter will actually have a license. While there are certainly honest and competent contractors out there, the industry is unfortunately plagued with incompetence and con artists. It is essentially up to you to project yourself. Therefore, when evaluating potential contractors, you should be diligent in your screening process. There are a number of"red flags" you should watch for:
Unwillingness to sign a written contract.
Insurance or licensing information you cannot verify. A qualified contractor should be able to provide you with proof of both licensing and insurance coverage. If the contractor can't give you a copy of his or her license and insurance policy, have him or her at least give you the license and policy numbers. It is a good idea, also, to ask for some other proof of identification at this time, so you can be sure you are actually dealing with the person whose name appears on the license. Checking the validity of licensing and insurance information is covered below.
DON'T RELY ON A HANDSHAKE!
Familiarize yourself with the licensing requirements for contractors. If you have Internet access, you can find this information online. A site that maintain state-by-state contractor licensing information is located at www.nationalcontractor.com. The National Association of the Remodeling Industry (NARI) also maintains information on state licensing requirements and a list of state agencies' phone numbers. You can also call your local building or planning department to inquire about licensing requirements.
When you're shopping for contractors, be sure to verify that both the license and insurance information you get is correct. Using the insurance policy number, call the contractor's carrier to make sure the policy is still in effect and that it covers projects such as yours. Also, call your state or local licensing board to verify the contractor's licensing information. The licensing agency should also be able to tell you if there have been any complaints registered against that contractor. You might also call your Consumer Affairs Bureau and Better Business Bureau to ask about any consumer complaints they may have received.
To better your chances of being satisfied with a contractor's work, you can also:
Even after you hire a contractor, you work is not complete. You will still need to remain in close contact with the contractor to ensure work proceeds on schedule and according to contract. And you may encounter complications or disagreements that need to be ironed out as the project unfolds. However, if you select your contractor carefully in the beginning, you are less likely to have problems later. While screening contractors may seem like more work than the construction project itself, the effort can save enormously in money, annoyance, and time.
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