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Home repairs and renovations are expensive. To cut costs, 1 in 3 homeowners want to hire a contractor who has gaps on their resume.
About 33% of homeowners surveyed say they would consider hiring a contractor with a questionable reputation to save money, according to a new report from Clever Real Estate, a housing data site.
Overall, homeowners say reputation is the most important factor when hiring a contractor (25%), followed by experience (23%), cost (19%), personal recommendations (13%), availability (11%), and estimated timeline For the project (10%). Clever surveyed 1,000 U.S. homeowners in mid-August about their options when it comes to renovations.
Experts say this trade-off with contractors may end up being more expensive in the long run. A questionable contractor is “someone who isn't completely honest about the price, or perhaps overstates his or her skills, doesn't do high-quality work, or simply doesn't show up for the project,” says Jamie Dunaway Seale, author of The Questionable Contractor. Smart report.
“This is the person you want to avoid,” said Angie Hicks, co-founder of the online contracting marketplace. “I would rather take someone new to the industry than someone with a questionable reputation.”
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The risk of fraud for contractors also increases in the wake of natural disasters, said Loretta Worters, a spokeswoman for the Insurance Information Institute.
“A lot of times, these people swoop in, claim they're going to do something for you, take your money and leave,” Worters said.
The Department of Justice and the Consumer Financial Protection Bureau issued a warning to consumers Wednesday about potential fraud, price gouging and collusive schemes following natural disasters.
“You don't want to make a bad situation worse,” Hicks said.
Here's what to consider when hiring a contractor.
Fraud against contractors can worsen after natural disasters
Analysts expect Hurricane Milton to be a “once-in-a-century” storm with the potential to cause record damage when it makes landfall along Florida's west coast on Wednesday or early Thursday.
As homeowners juggle insurance claims and recovery efforts from the effects of cascading storms, one thing to keep in mind is who to hire as a contractor.
“You really need to be careful” about scamming contractors, as you could be “double victim of the storm and the scammer,” Worters said.
Roofing is one of the most common trades to hire after a hurricane, Hicks said.
“The roof is something that will last 20-plus years,” Hicks said. “You want to make sure you are working with a reputable local company that will back the warranty on this work as well.”
Although this is a truly difficult time, it's important to do your due diligence and make sure the person you hire is certified, experts say.
3 ways to examine the contractor before contracting with him
Although most professional contractors are reliable, negative experiences contribute to a bad reputation in the minds of consumers, Cleaver noted in the report.
“A lot of people have bad experiences, and that makes it more difficult to be honest” in this field, Dunaway-Seal said.
Although it can be difficult to evaluate contractors, there are some steps you can take to make sure you're working with someone reputable, according to experts.
Here are three ways to get started:
1. Ask for reviews and references
“The first thing you want to do is check (the contractor's) reputation,” Hicks said.
If possible, start with professionals who have good reviews: Ask for recommendations from friends and family who have had good experiences with the contractor in the past, Dunaway-Sell says.
From there, search for online reviews and ask for references, experts say. When you start getting estimates, check references to see how that company or professional has handled jobs in the past, Hicks said.
Asking a contractor if they've put you in touch with a previous client can be a litmus test, Dunaway Sell said.
“If they're not willing to do that, that could be a red flag,” she said. “Maybe they don't think anyone will recommend them favorably.”
2. Verify their credentials
Check the contractor's credentials and license to see if he has the experience needed to handle the job, Hicks said.
All professional contractors must be insured and be able to show their certifications proving this, according to the National Association of Home Builders. NAHB noted that while not all states require a license, contractors located in states that do require a license must provide a copy.
The FTC and CFPB provide resources for consumers on how to avoid scams, prepare for and respond to natural disasters, and how to handle your money in such events.
“Sometimes the state Department of Insurance will have a list of different contractors on its website as well,” Worters said.
3. Pay attention to warning signs
Early interactions can give you an idea of how a contractor works, and help you decide whether you feel confident giving them your work.
“Do they give you written estimates? Are they detailed? Are payments specific?” Hicks said.
It's really important to factor payments for larger projects into your estimates and how you handle them, she said. Typically, down payments should not be more than 10 or 20%; You shouldn't pay a large deposit upfront, Hicks said.
It's also a good idea to get two or three estimates because they can tell you if you have outliers in your prices, Hicks said.
“If a deal sounds too good to be true, it probably is,” she added.
