Category: Home Ownership article

How to Hire a Contractor to Get an Incredible Home Remodel

The past couple of years have brought a major boom to the home improvement and repair industry. More people are buying fixer-uppers to renovate or adding equity to their current homes by remodeling.1 If you’re one of the many homeowners looking to start a home improvement project, we’re here to help you learn how to hire a contractor. Take a look at our tips to help ensure your project gets off on the right foot—and is completed smoothly.

Why hire a contractor for remodeling work

Depending on the scope of your project, the amount of time you have and your experience level, it may be beneficial to hire a contractor. If you’re remodeling your kitchen and need to hire multiple professionals to complete the work, you may be better off handing the job to a general contractor. They have relationships with experienced plumbers, electricians and other subcontractors, and can coordinate the work so you don’t have to spend time overseeing multiple people.2

Hiring a contractor can also save you time and money. Contractors are experienced at what they do, so they know how to order the right amount of materials, schedule labor and adhere to a project’s timeline. If you have a reputable contractor at the helm, you can trust that they’re working as efficiently as possible—and doing the work correctly.2

If you have a smaller job—like painting walls or adding shelves to a pantry—you may be better off hiring a handyman or completing the work yourself, if you’re comfortable making home improvements.

How to find a reputable contractor

Finding a general contractor doesn’t have to be difficult. Amica offers the Home Repair Assistance Program for customer claim referrals and the Consumer Service Program for non-claim referrals via Contractor Connection®, a service where we match policyholders with trusted contractors in their area. The contractors in our program are vetted by a rigorous credentialing process, so you can be assured that they’re financially stable, licensed, insured and able to perform quality work on your home. The contractors also stand behind their work with a limited workmanship warranty.

You can also reach out to family members and friends for a referral. When you talk to a friend or relative, it’s easy to ask questions like:

  • Were they on time and on schedule?
  • What is the quality of their work?
  • How much did they charge?
  • Did you feel the pricing was fair?
  • Is there anything I should know that’s concerning?
  • What did you like most about this contractor?

Try to collect names of least four to six contractors to evaluate.3 This gives you several options from which to choose, so you can find the right professional who’s a match for your project and your personality. Once you collect a few names, look them up online to read reviews, if they’re available. You can also search the National Association of the Remodeling Industry or check in with your local municipality to ensure they’re licensed, and carry personal liability insurance, property damage coverage and Worker’s Compensation insurance.4

Once you’ve narrowed down your list even more, conduct phone and in-person interviews. During these interviews, you’ll want to ask:1,3

  • Do they typically work on remodels like yours? Or bigger or smaller projects?
  • What is their experience?
  • How long have they been doing this type of work?
  • Do they have photos of recent work they can provide?
  • Do they have references they can share?
  • When can they start?
  • Will the project require pulling permits?
  • Do they provide a contract before starting work?
  • What is their payment model?
  • Can they provide proof of applicable licenses and insurance?

Throughout the interview process, you’ll want to find someone who has significant work experience, and who carries a top reputation. Ideally, you’ll hire someone with integrity, good listening skills and a track record for success.5

How to select the right professional

Next, invite your top two or three contractors into your home to review your space and discuss the project. Be prepared to discuss your budget for the project, desired timeline and what you’d like your remodel to include. Remember to stay flexible. For example, you may need to adjust your budget if you’d like to add costly features, like custom kitchen elements or high-end materials.

Once you have met with each contractor, ask for a breakdown of materials, labor and other costs. After all, you don’t want to face hidden project expenses once your remodel is underway. Generally speaking, materials should make up nearly half of the total project cost (40%), while the rest should be labor and profit.6 Keep in mind that things like labor and supply chain challenges can impact the cost of materials.

Take your time before making a final decision on a contractor. Remember, doing your due diligence at this point can help you select the right contractor and avoid unexpected disasters and rising costs along the way.

How to set a payment schedule

As you evaluate bids, it’s important to ask contractors how they design their payment schedules. Depending on the size of the job, reputable contractors will ask for a 10%-30% down payment when you sign the contract. Based on the amount of the down payment, they will then set a schedule for the remaining balance as the project is completed. Beware if they ask you for too much money up front. It could be a sign of financial issues or a scam. It’s always best to avoid making a final payment until the work is complete, and you’re fully satisfied.6,7

Above all, never pay cash up front for your project. If your contractor bails, or if the work is done poorly, you’re at risk of losing your money.8 If you hire a contractor for a smaller project, like replacing part of your deck, you may be able to pay with a check or credit card. And, if you’re adding a new room or refinishing a basement, it may be possible to secure financing.3 Speak with your bank or a financial professional if you need help.

How to draw up a contract

Make sure your contract outlines every project detail possible. If in the off chance something goes awry and you need to seek legal advice, it’s imperative that your contract offers all the details in writing. For example, a solid contract should include:3,9

  • Your contact information
  • Your contractor’s contact information
  • Your contractor’s certifications including licenses and insurance
  • An in-depth description of the project
  • A detailed schedule and timeline, including potential conflicts
  • A list of required materials and their costs
  • A list of subcontractors, their company names, their budget and start and end time
  • Information about inspections that may be required, including who’s responsible for securing them
  • A payment schedule, and information about financing (if applicable)
  • What permits must be pulled, as well as a guarantee that the contractor will pull these documents
  • How you’ll handle any changes to the scope of work
  • A “broom clause” that makes the contractor responsible for handling unexpected messes
  • What happens if you or your contractor must terminate the project

When you feel confident that the contract meets your expectations, then it’s time for you both to sign and begin the work. Keep copies of your contract on hand so you can review the schedule and costs along the way, and ensure the project is executed correctly.

Learn how your remodel may impact homeowners insurance

Now’s a good time to contact your homeowners insurance company to ask if your remodeling project will impact your premium. In general, if your project increases the cost of rebuilding your home after a disaster, then the answer is yes, your insurance premium will increase. But if you’re working on a smaller project, like adding shelves or repainting walls, then it probably won’t.10

An insurance professional can help you understand the impact of your remodel on your insurance. If you’re improving your home’s safety, like replacing old electrical wiring, or adding home technology upgrades, (for example, security cameras or automatic leak detection systems), you may get a discount. The same goes for simple home maintenance projects.

How to handle issues that arise

As you embark on renovations, be aware that timelines frequently change, and supply chain issues can impact costs and availability of materials which are often out of the control of the contractor. Ideally, there will be no issues and the renovations you’ve been dreaming of will be successfully completed. But the reality is, sometimes problems occur. While faulty workmanship is not covered by insurance, ensuing damage typically is. In the unfortunate case that this happens to you, know that there are resources to help. First, try to resolve any issues directly with your contractor. If needed, you can also reach out to:3

  • The Better Business Bureau
  • A local home builders association
  • A local consumer protection office
  • A state attorney

If you did your due diligence during the hiring process, as well as when agreeing to the contract, your risk for issues will be significantly reduced. But remember, unforeseen circumstances can happen to anyone. Do your best to look ahead and resolve them swiftly.

 

  • How The 2021 Home-Improvement Boom Became Another Division Between Boomers And Millennials, Business Insider, 2021.
  • 5 Reasons To Hire A General Contractor For Your Next Project, Forbes, 2021.
  • The Step-By-Step Guide To Finding, Hiring And Working With Contractors, Home Advisor, 2021.
  • How To Hire A General Contractor: Checklist And Tips, Forbes, 2021.
  • Five Qualities To Look For In A General Contractor, LinkedIn, 2015.
  • Tips for Hiring a Contractor, This Old House, n.d.
  • When To Pay A Contractor The Final Payment, NewSilver, 2020.
  • Why You Should Avoid Home Contractors Who Ask To Be Paid Upfront, The Washington Post, 2017.
  • Using a General Contractor Agreement, LegalZoom, 2020.
  • Nail It: Home Insurance for Renovations, Forbes, 2021.

Want to learn more about Amica home insurance? Call today for a free personalized consultation.

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