Educational Consumer Tips
Better Business Bureau
The BBB suggests that you solicit two or three bids for any work you plan on contracting.
Do not automatically accept the lowest offer. Make sure all bids are based on the same set of specifications and quality of materials to be used. Ask for local references and if possible, inspect the finished projects. Check to see if the contractor is a member of a professional association, which has standards for members. Make sure the contractor is in compliance with all local licensing, bonding, and insurance requirements, and that any necessary building permit is obtained.
Typically, a down payment of one-third of the total contract price is made with additional payments made after completion of each phase of work; final payment should not be made until work is completed and you have inspected the work. If the contractor arranges financing for the work to be done, be sure you understand all aspects of the financial terms, especially if a second mortgage of your home is used as security for the work.
As with any contract, never sign a blank or partially blank contract. Get all verbal promises in writing. If the project is to be completed by a certain date, make sure that is in the contract as well. You may want to inquire about inserting an arbitration clause into your contract in case of any dispute between you and your contractor.