Taking on significant home renovations or upgrades can be challenging, especially when selecting the right contractor for the job. Choosing the wrong one can result in disastrous consequences, including extensive damages, insurance loss and even injuries. 

Here are some tips to help you select the right one for the job.

Craft a detailed plan

Before starting any home improvement project, it is crucial to have a detailed plan in place. The more detailed your plan, the more precise your cost estimates will be.

Know your material costs

Since 2020, building material prices have surged by 35.6%. Understanding material costs before seeking a quote will reduce the risk of sticker shock.

Obtain referrals

When searching for a contractor, always ask for references. Referrals from friends, coworkers and family members can provide insight. Additionally, consider seeking recommendations from neighbors, local hardware stores and past real estate agents.

Interview several contractors

To ensure that you choose the right general contractor for your home improvement project, it is important to interview a minimum of three candidates. During this process, use a checklist and ask each contractor numerous questions, including whether their business is licensed and insured.

Before hiring someone, check with your local municipality to learn about necessary licenses.

Additional questions for prospective contractors may include:

• What is your experience with this type of project?
• Can you provide references from previous clients?
• What is your timeline for completing the project?
• What is your process for communicating with clients?
• What is your approach to solving problems and handling unexpected issues?
• How do you handle change orders or additional work requests?
• What is your payment schedule and method?
• What does your contract include? (See next section.) 

Again, be sure to verify that prospective contractors have appropriate insurance and licenses, as well as a clear contract outlining the project scope, timeline, budget and any other important details.

Contract and ground rules

Here are some important elements that should be included in a contract:

• Business name and contact information of the contractor.
• Contractor’s insurance and licensing details.
• A highly detailed description of the work to be completed, including a timeline and schedule.
• A materials list (including model numbers) and who is responsible for providing the materials.
• Payment terms: Expect to put down a deposit before work begins. Certain states have restrictions on the size of the down payment for home improvement contracts. Check your state’s laws and requirements before agreeing to a down payment amount.
• Required permits and who is responsible for securing them.
• A process for handling changes and disagreements.
• A termination clause to protect both parties.

Obtain lien releases and receipts

To prevent a mechanic or construction lien from being placed on your property, request copies of receipts for all materials and lien releases from the general contractor and all subcontractors. This is especially important if your contractor fails to pay their subcontractors or suppliers, as attempts to collect the debt may result in the sale of your home to cover the unpaid amount.

Hold onto your wallet

Delay making the final payment until you are fully satisfied with the finished work and have received lien releases and receipts. This should be outlined in your contract and payment schedule to avoid any misunderstandings or disputes.