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Need to Hire a Contractor? Here’s What to Know

Sep 2 2021

This is part of our ongoing series on home maintenance basics to help you keep up your home and grow your investment with confidence.

Hiring a general contractor can be a little complicated, as anyone with home renovation experience will tell you.

It requires a bit of a juggling act with time management, confident decision making, financial organization, and patience.

You see, a contractor’s job is to help you plan a project and make sure it gets done well. They do the heavy lifting, but you’ll provide much of the brainpower.

So, ready to find your pro? Our guide to hiring a contractor is the perfect preparation:

1. What is a general contractor?

Understanding the role of a general contractor is a good place to start. A contractor will come to your house, discuss the project you have in mind, explain the possibilities, and estimate how much it will cost. For a little more detail, here’s a list of what they can do:

  • Hire, coordinate, supervise and pay subcontractors
  • Obtain permits
  • Schedule inspections
  • Root out potential problems and troubleshoot along the way
  • Order materials and schedule deliveries
  • Make sure that everything is up to code
  • Guide the job to completion at the quoted price

Heads up: Before diving into a project, here’s what to discuss with your contractor.

2. How much money do general contractors cost?

Contractors typically charge 10-20% of the total cost of the project, including materials, subcontractors, and permit fees. Some may be more expensive than others, so it helps to get multiple quotes (more on that later).

When you do pay your contractor, do so on time (it helps to keep them happy!) and by check so it’s documented. You can also request a lien waiver (aka conditional release) each time you make a payment. This shows that the suppliers, laborers, and subcontractors have been compensated and prevents the consequences of unpaid bills.

3. How do you choose a general contractor?

Like with anything else, you’ll want to shop around to find the right fit. It’ll be worth it when you get good work at a fair price. Plus, if you plan to do more projects in the future, or have any unexpected emergencies, you have someone to call.

A subpar contractor might cut corners to fatten their wallet, treat you disrespectfully, or even blow off finishing a job. These are extreme circumstances, but just in case, here’s how to avoid that nightmare:

Get referrals from friends. Ask people in your network if they know a good contractor in the area. You’ll want to hear that a job was done well, completed on time,  and stuck to the predetermined budget. A contractor should be receptive, explain things thoroughly, and be easily reachable for questions, even after work is finished.

Meet with several before choosing one. The general rule is to meet with (and receive estimates from) at least three contractors before picking one. Questions to ask include:

  • How many similar jobs have they worked on?
  • What materials do they have in mind?
  • What will a project like this cost?
  • How will they keep things clean and safe while they work?

You’ll want a good rapport with the person, too. Remember, they’re going to work in your home and you’ll need to interact with them a lot. Nix anyone who tries to pressure you into things you’re uncomfortable with.

Request at least two references. Especially if the contractor wasn’t given to you through a referral. References should be former clients who needed work that’s similar to yours.

Check credentials. Confirm that they’re state-licensed, bonded, and insured. Ask for current certificates as proof. While you’re at it, it’s always a good idea to check for complaints with the Better Business Bureau.

4. What’s in a general contractor’s contract?

Say that five times fast!

Home renovations are a big deal and are often expensive, so get the nitty-gritty details in writing. Below are some of the terms that should be outlined in your contract. Make sure it is signed and dated.

  • General contractor details, such as their name, address, phone number, and license number)
  • Description of the work to be done, including materials and fixtures
  • Timeline of when the work will take place
  • Payment schedule noting what you will be charged and when
  • Permits and authorizations specifying that it will be the contractor’s responsibility to obtain them
  • Project changes, clarifying that they need to be approved by you in writing (so you don’t end up paying for things you didn’t authorize)
  • Termination clause explaining the conditions under which you or the contractor are allowed to cancel the contract

5. How do you supervise a general contractor?

Keep an eye on the project as it progresses. Is the timeline being met? Are things being done correctly? Does the work area look safe? Speak up about your concerns and document problems with as much detail as possible. Keep an ongoing list of subcontractors that are hired too, just in case.

Ideally, your contractor will keep you informed and relaxed, and you’ll be on your way to a completed renovation!

For more handy info, check out these posts:

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