With a raft of home improvement websites that specialize in matching homeowners to contractors, and social media sites making it easy to receive referrals from friends and family, finding a reliable contractor is a straightforward process.
But once you find a potential contractor, you must ensure he or she is the right fit for your home improvement project. That's why many experts advise making a few key inquiries to learn more about a prospective contractor and assess accountability before hiring one. Before you select a contractor, ask these questions to set realistic expectations, avoid hitting major snags and ensure you get what you want.
1. Do you have references? "It is always a good thing to ask for references. You don't necessarily need to call them, but you should always request them," says Nathan Outlaw, owner of Onvico, a general contracting company in Thomasville, Georgia. "If a contractor hesitates or doesn't want to give references, it quickly tells you that they may not be worth doing business with."
There's an even better question to assess a potential contractor's credentials, according to Monica Higgins, a former licensed real estate agent turned construction manager who owns Renovation Planners, an LA-based company. She suggests asking: "Can you provide the addresses of previous jobs, so I can drive by and see the work myself?"
While checking out past projects may not be feasible (for example, you may be able to drive by and look at a house's addition, but unable to enter a stranger's home to look at a kitchen remodel), Higgins says your contractor may have photos of that remodel. If you do talk to a contractor's references, you'll want to ask what he or she was like to work with, if the projects were finished on time and if they were happy with the finished work.
2. Are you licensed and can you show me proof? Outlaw says a lot of contractors will attempt to pass themselves as licensed – even if they aren't.
"No matter what the contractor says, you should do a search for license verification on your favorite search engine and check to see what licenses, if any, the contractor you wish to hire has," Outlaw says.
Still, your prospective contractor's website may say that he or she is licensed. That's why Outlaw says you should ask to see proof. Also, keep in mind your state should have a website that allows you to look up home contractor's licenses. So, if you get a license number, you can at least learn if the contractor is legitimate.
It's also a wise idea to put the contractor's name in a search engine and see if there's a history of negative reviews for his or her work. You can also find contractors at home improvement websites, such as Angie's List and Houzz.com, that match homeowners with contractors, but while a company may claim that the contractor is vetted, that may or may not always be the case. For instance, the San Francisco District Attorney George Gascón recently announced that his office is suing the popular website HomeAdvisor.com, alleging that it rarely does criminal background checks. So, it never hurts to look someone up on the internet to see if any worrisome information pops up.
3. Are you insured? In other words, you want to make sure you're protected from being sued if someone is injured on the job in your home. Having everything down in writing will also keep a project from going off the rails.
"A handshake is a great thing between friends," Outlaw says. "However, in the professional world, you need a contract to protect both parties." Outlaw says the contract should spell out the scope of work, a schedule of when you're paying the contractor and what will happen if changes need to be made or one of the parties doesn't pay or complete work.
"The proof should be sent to you with the contractor's name or company listed as the insured and the owner – you – as the certificate holder. Don't just accept them handing you a certificate. Call and request one yourself," Outlaw says.
4. Do you have a warranty? No matter how straightforward the project, it may still go awry. Maybe a contractor had a bad day, or the materials he or she purchased weren't of the best quality. Inquiring about a warranty is important because you don't want to pay for, say, a beautiful but slanted deck.
Charles Thayer, founder of All Around, an exterior home improvement company based out of Golden Valley, Minnesota, suggests following up with, "May I see it?"
And be sure to read the warranty, in case there's anything in the fine print that you don't like. For instance, most remodeling projects will have a year's warranty, though some states require warranties to last longer. It's also good to remember that if a problem arises, it may not be the contractor's fault but rather the manufacturer of the materials, in which case, the manufacturer's warranty may cover the costs of fixing whatever issue arises.
"If they don't have one, it may mean they don't really plan on standing behind their work," Thayer says. While these are tough questions to ask, making these inquiries may help you spot the legitimate contractors from the con artists.
5. Can you tell me more about the process? It's key to find out what you're in store for, especially if this is a potentially long, expensive or involved project, to avoid problems down the road.
Thayer says some questions you'll want to ask of a big project include: "Where will workers park? Where will materials be staged? Where will the dumpster go? If the dumpster is on the street, who is getting the permit for that? These are all important questions that many people forget to ask about until they can't park in their own driveway or when their lawn is ruined by a dumpster. Everyone should be on the same page."
Even if you don't know what to ask – maybe it's a bathroom remodeling, and you know there won't be a dozen workers, for example – you can still ask questions like, "How long will this take?" If you have any pet peeves, like smoking in the house, this would be a good time to discuss any concerns.
6. Where is your business located? This may seem like a strange question to ask, but it can be especially important if a contractor approaches you at your front porch to do work on a project. You want to vet this person, and asking where he or she is from is a good place to start.
"Especially after a storm, don't sign up with the first contractor to show up at your door. Ask for references and try to work with someone local," Thayer says. "Avoid storm chasers. They roll into town and then disappear as soon as the work is done."
In fact, government organizations, police stations and groups like the Better Business Bureau frequently put out notices, warning the public to be extremely wary about contractors dropping by your house after an intense storm.
You shouldn't hire any contractor in a hurry, he adds. "Many times, homeowners feel rushed," Thayer says. "But you are making a decision about one of the biggest investments in your life – your home. You should know exactly who you are working with."
The biggest nest egg
Homes represent the bulk of even a moderately affluent preretiree’s wealth, beyond pension and Social Security income. Studies show that people should more fully explore how their home can be used as a key asset to help fund retirement.Home equity loan
Home equity loan
Pulling money out of your home is often not advised if the money is needed for basic living expenses. Lenders also need to be sure you’ll be able to repay the loan. One retirement-friendly use of home equity loan funds is remodeling, to make your home “senior-friendly” so you can continue living in it as you get older.Reverse mortgage
Reverse mortgages allow you to tap the equity in your home and stay there as long as you want, so long as you can continue paying property taxes, home insurance premiums, and maintenance expenses. Reverse mortgage fees have been criticized as too high, but the government recently began supporting a less expensive home equity conversion mortgage product called the HECM Saver loan. However, the “price” of smaller fees is that consumers get access to smaller shares of their home’s equity.Adjustable rate mortgage (ARM)
Adjustable rate mortgage (ARM)
A five-year ARM can be had today for less than 3 percent in some markets. If you know you will be selling your home within five years, getting a five-year ARM can allow you to pay down the principal balance on your loan and keep more of the equity for yourself when you sell the property.Rent a room
Rent a room
It can be hard to let a stranger into your home. It can be harder still to afford your home on a retirement income. Talk to friends who have done this and learn from their experiences. Insist on personal references and consider paying for a background check before executing a rental agreement.Rent your entire home
Rent your entire home
According to tax experts CCH, if you rent your home for fewer than 15 days a year, the money you receive does not need to be reported as gross income on your tax return. Also, if you’re planning to take an extended trip, your home can be safer if it’s occupied by a temporary renter than if you left it vacant. To increase your comfort level, work with established vacation rental companies.Downsize housing expenses
Downsize housing expenses
For many retirees, the smart housing move is literally that—a move to a smaller home and perhaps even a different state or country that offers sharply lower living costs. Be wary of being trapped in your home by memories or old possessions that can weigh you down emotionally and financially.Mortgage interest tax break
Mortgage interest tax break
Interest payments on your home are still tax deductible. You can deduct the interest on home equity loans as well. Interest deductions rarely turn a bad decision into a good one, but they should be included in your evaluation.Energy tax credits
Energy tax credits
Some energy tax credits were extended into 2011 and there are continued tax credits for solar and other alternative energy investments in your home. Check out a fuller summary from TurboTax of tax breaks over the next few years.Non-taxable home sales gains
Non-taxable home sales gains
Gains on the sale of your current home—up to $500,000 in gains for a couple—are tax-free. You must have lived in the home for two of the past five years, according to tax experts CCH, but there can be exceptions due to health or other emergency factors.See more Money slideshows:
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Williams got his start working in entertainment reporting in 1993, as an associate editor at "BOP," a teen entertainment magazine, and freelancing for publications, including Entertainment Weekly. He later moved to Ohio and worked for several years as a part-time features reporter at The Cincinnati Post and continued freelancing. His articles have been featured in outlets such as Life magazine, Ladies’ Home Journal, Cincinnati Magazine and Ohio Magazine.
For the past 15 years, Williams has specialized in personal finance and small business issues. His articles on personal finance and business have appeared in CNNMoney.com, The Washington Post, Entrepreneur Magazine, Forbes.com and American Express OPEN Forum. Williams is also the author of several books, including "Washed Away: How the Great Flood of 1913, America's Most Widespread Natural Disaster, Terrorized a Nation and Changed It Forever" and "C.C. Pyle's Amazing Foot Race: The True Story of the 1928 Coast-to-Coast Run Across America"
Born in Columbus, Ohio, Williams lives in Loveland, Ohio, with his two teenage daughters and is a graduate of Indiana University. To learn more about Geoff Williams, you can connect with him on LinkedIn or follow his Twitter page.
Devon Thorsby | June 5, 2019
Homeowners should not fret, as long as they're prepared for the possibility of a downturn.