How to Spot a Dishonest Contractor Before It’s Too Late

How to Spot a Dishonest Contractor Before It’s Too Late

There’s no shortage of renovation contractors these days…but how do you know if they’re any good? The number of dishonest contractors may surprise you.

Here at GreatBuildz, a free service that connects homeowners with reliable general contractors, we spend lots of time screening contractors to find the best ones – here’s my own personal experience.

My dad was an electrical contractor for over 40 years.

When I was a teenager growing up in Northern California, my summer job was always working for my dad. With my mom’s help, my father operated a small business as an electrician. So, from the age of thirteen, I spent my summers learning the trade by working on jobs along with him.

Working with family isn’t always easy or fun, but I’d say it taught me some valuable lessons. I picked up some electrical knowledge, but maybe more importantly, I learned some lessons about human nature and human interaction.

I like to think of my dad as an honest and hard-working man. He worked his entire life to support his family, he didn’t take handouts, and stayed out of debt. Him and my mother were married 50 years before he passed away. I’d say he was a solid, upstanding man.
While I worked with him, I witnessed his interactions with our customers. Although I believe he was generally honest in how much he charged clients, I could tell there were times that he stretched the truth to get a higher fee. I don’t hold it against him or think worse of him, much of that is human nature.

But, I feel it’s important now to share my knowledge so others can get a better understanding of how a dishonest contractor might think and act.

Even in today’s age, the contracting profession is still kind of the “wild west”.

There is absolutely no consistency in cost, quality, or most other factors between two companies, let alone an entire industry. It’s almost impossible to compare two companies one-to-one.

Furthermore, the customer generally has no idea how much various jobs should cost. So, in a way, its kind of hard for a contractor to decide what to charge someone for a specific job. Many times, their thought is ‘I’ll charge as much as I can get away with and not anger the client’.

If you think about it, this is no different than what most of us would do when faced with an opportunity to earn some money. For example, say a stranger wanted you to clean the leaves from his gutters and asked you what you would charge him. Presumably, your customer doesn’t know what a task like this should cost. How would you come up with a price? You’d want to maximize your revenue without making the price outlandish.

One tactic most homeowners use to avoid getting ‘taken’ is to get three estimates. While that’s a very good start, it still doesn’t solve the core issue.

How to Spot a Dishonest Contractor Before It's Too Late 1

Once you have your three bids, how do you choose the right one?

Picking the lowest price makes sense at first, but then you run the risk of hiring a dishonest contractor. He may bid low, then intend on making up for his low bid by ‘nickel and dime’-ing you with many change orders during the job.

Unfortunately, there are many other ways a dishonest contractor could rip you off. A dishonest contractor could take your deposit and never do the job. They can use poor quality materials without telling you. Some contractors even hire cheap, unqualified labor to save on costs, the list goes on and on.

For all these reasons and more, it’s important not to make your decision purely on the lowest bid.

So, as a homeowner, what’s the answer to this conundrum?

Educate and Prepare yourself!

When you consider buying a new car or a new appliance, you likely do some research online first. Since construction projects are a much more complicated transaction, it’s even more important that you do your research. Trust me, do not choose a contractor only based on your ‘gut feeling’ after getting an estimate. You know that saying, “Failing to prepare is preparing to fail”? That could not be more true when it comes to hiring a good contractor.

Although contractor referral websites have made it easier to find local contractors, most of them still can’t ensure you’ll find a good, honest one. And a good, honest contractor is your key to having a positive renovation experience.

Before you hire a dishonest contractor, here are some tips to educate and prepare yourself:

  • Check out the contractor’s online reputation – Google them, look for reviews about them, see if they have any social media accounts, etc.
  • Make sure they’re licensed – Check your state licensing board to ensure the contractor is legitimate
  • Call their references and take a look at their prior work. If you have the chance to visit one of his past jobs and see the renovation in person, even better!
  • Run a background check on them – Your contractor and his team will be in your home, quite likely without you in it. You want to make sure you can trust them, same as you would with a nanny for your child.
  • Prepare a detailed scope of work, a list of materials, and be sure to have an understanding of what these should cost. Ask an unbiased third party with construction knowledge to help you with this.
  • Read the contract! Ensure that anything they ask you to sign has the language you want in it. Speak with a construction attorney or search online for important items to include in a construction contract.
  • Set out your expectations of them. A good way to do this is to present them with our “Contractor Code of Conduct” document. If they don’t agree with some of these expectations, they should explain why. This might be a sign they aren’t right for you.
  • Meet the person on their staff who will manage the job/be your day-to-day contact. Identify who will do the labor (and what their experience is in doing these tasks).
  • Prepare a comprehensive checklist – Ask the potential contractor important questions you need to know about them and their process to ensure they are a good fit for you. Make sure to use the same checklist when you’re interviewing multiple contractors!

 

If you’re in the middle of screening a contractor yourself, or even if you’ve just started planning a home renovation project, give Greatbuildz a call. Our friendly GreatBuildz staff can help make sure you’re in good hands, then support you throughout your project – all for free.