Although communicating with our contractors is an important part of successfully building our homes, there are certain things that we should never say to them. This week, and next week, we’ll discuss some of those taboo phrases or questions that should never be uttered to our contractors. Here's the first part of our list...
1. You’re the only one bidding on this job.
As a general rule, we should always get a minimum of 3 bids. And we should let the contractors bidding on our projects know that we are considering other contractors and getting more than one bid. That way, they know to price their work competitively. Ask specifically for a bid with an itemized cost breakdown of materials and labor. This will really help you when comparing bids and contractors. Be aware that many contractors will markup the cost of materials. It’s important to independently verify the cost of materials after receiving a bid, by getting a quote from the supply warehouses yourself. If you’ve found that your contractor has marked materials up, during negotiations, you can ask him if he would be willing to drop that markup.
2. I'm not in a hurry, so take your time.
Telling your contractor you’re not in a hurry implies that it’s okay for him and his crew to prioritize other projects over yours. We should all expect a few delays due to uncontrollable circumstances, but it’s better to tell your contractors up front that you need their work to be completed by an agreed upon timetable. That will give them a sense of urgency and timeliness that you probably won’t benefit from if you tell them you’re in no hurry. To minimize delays, you can specify in your contract how many contractors should be on the job site each day and that work will be “continuous, if weather permits," meaning the crew can’t take a week or two off unless work is hindered by bad weather.
Request a firm start date and an estimate of the completion date. And add the phrase “Starting and completion dates are of the essence of the contract.” This statement will give you greater protection if a schedule dispute arises.
3. I’ll pay you upfront for the job if you give me a good discount.
Giving your contractor a ton of cash upfront won’t usually make your contractor move faster or do better work. In fact, paying a contractor his entire fee upfront is one of the stupidest things anyone can do, even if he agrees to give a significant discount.
If you pay a contractor upfront, he has absolutely not incentive to do a good job in a timely fashion, and worse, he might take your money and disappear. Holding off on payment allows you to hold the contractor accountable. Pay your bill upfront, and you’re taking that safety net away.
I’m not even a fan of giving the contractor a significant deposit before he has started work. Most contractors that are in good financial standing should have enough money to get the materials needed to start your project. If not, you can offer to accompany them to the supply warehouse and make the purchase of materials yourself. Be sure the company delivers the materials to your homesite, and not the subcontractor.
Be advised that if you pay somebody too much upfront, there is no guarantee that they will finish the job.
4. Since you’re almost done, here’s your final payment.
Even if there’s just a little cleanup, or a few last finishing touches to be done, it’s always best to hold the final payment. Never give a contractor his final payment until after the project has passed inspections and the project is done to your satisfaction, including punch list items, which are small fixes or touch ups that need to be completed. Withhold a significant agreed upon amount for the final payment, around 20-33% of the total fee. This will incentivize contractors to complete your job. If the final payment is only 5-10% of the job total, the contractor may be tempted to move on to the next, more lucrative job without completing your project.
At the end of the job, don’t forget to get an Unconditional Waiver of Mechanic’s Lien Rights, also called a final lien waiver. This frees the homeowner from the responsibility of making future payments and from having to pay the contractors’ unpaid bills. So, if you have an unconditional lien waiver, you, as the homeowner, cannot be sued for outstanding bills for labor or supplies used for your project.
5. This is my budget for this project.
If you’re hiring an architect, I think it’s important to disclose your budget so she isn’t designing a home that’s larger, or more complex, or detailed than you can afford. However, when it comes to contractors and interior designers, keep your specific budget to yourself. If it makes you feel better, you can give them a budget range. For example you can say something like "between $20,000 and $30,000".
The better thing to do, in my opinion, is to tell contractors the level of quality you are expecting (based realistically on the money that you know you have for the project) and give them a list of your must-have materials, for example Energy Star rated, double pane windows, or copper plumbing, or asphalt roof shingles with a lifetime warranty. Tell them your favorite brands and any details that you know and care about, then let them come up with the bid independent of knowing your specific budget. You can always adjust the materials to fit better into your budget after you get the bid.
Now we definitely want to be respectful of the contractors’ time and effort, so before they start working on the bid, give the contractors as much information about home’s details and materials as you can. But let the bid be based primarily on the cost of materials and labor, instead of the bid being based primarily on your budget. If you tell your contractors you have about $15,000 to spend on windows, or landscaping, or plumbing, or cabinets, you’re more than likely gonna get bids around $15,000, even if the contractor could do a quality job for $10,000.
6. I’d like you to choose the materials for my job.
If you allow the contractor to choose all your materials for you, you give him the power of controlling the quality and cost of the job. He might choose materials that are too high end, or he might choose materials that are inexpensive and poor quality. You, as homeowner, should be controlling the quality and cost of your project, not your contractor.
It’s important that we continue to educate ourselves so we can make the smart decisions about the materials we use for our homes. Even if you don’t know everything each a type of material, we should be able to communicate whether we want a high end product, low end product, and something in the middle. Electrical wiring, for example, is something that most laypeople will never full understand, but we should be able to generally communicate our expectations. You might say, for instance, “I don’t necessarily need top of the line materials, but I want really good quality materials that will allow me to have a party in the dead of summer with air conditioner on full blast, most of the lights and appliances running, and have a DJ be able to play with all his equipment, without blowing a fuse.”
For things like cabinets, flooring, HVAC systems, interior doors, windows and roofing, we should know basic differences in quality and cost, so that we can choose what’s best based on our needs and budget.
Specify within the final contract which materials the contractor should use. And to protect against obviously substandard materials and workmanship, include a catchall phrase in your contract that says something like the contractor will “complete the project in a professional manner”.
7. Don’t worry about cleaning up your mess, just get the job done.
Newsflash: Cleaning up is a part of getting the job done. It’s common courtesy— people, and especially contractors, should clean up after themselves. One contractor’s mess may hinder the work of another contractor, so it’s important to make material disposal and clean up a part of the contract. Standard contracts should include the phrase: “The work area should be left broom clean.” That phrase works for most contractors.
Some trades may charge a substantial amount for clean up, depending on your location. You might want to save a few bucks by cleaning up yourself, but that takes a lot of time and work, and some counties charge substantial fees for waste disposal and have strict regulations and recycling rules about construction waste. Therefore, in most cases, making clean-up your contractors’ responsibility is worth the expense.
8. You understand what I want, don’t you?
Don’t assume a contractor knows what you want, or what you have asked for, even if you have communicated it verbally. Make sure you spell everything out in the written contract, and/or materials list, and/or the scope of work. It’s even better to add printed photos or sketches of what you want so there’s not only verbal and written communication about the project, but visual examples too.
Ask the contractor specific questions about his understanding of what’s been decided. Something like, “I just want to make sure I’ve got this straight… what’s the exact name of brick we’re going to order?” Or “Is the electrical outlet going to be placed here or over there?” Or you could say, "Can you summarize things for me, so I’m clear about our plan?"
Ask questions in a kind, non-condescending way, not like you’re testing the contractor, but as if you ‘re trying to make sure you understand what’s going on.
Well, that was part 1 of Things You Should Never To Say To Your (Sub)Contractors. Come back next week for part 2. Thanks for stopping by.
Please remember that the purpose of this podcast is simply to educate and inform. It is not a substitute for professional advice. The information that you hear is based the only on the opinions, research and experiences of my guests and myself. That information might be incomplete and it’s subject to change, so it may not apply to your project. In addition, building codes and requirements vary from region to region, so always consult a professional about specific recommendations for your home.
3/6/2019 05:12:45 pm
Reading through these scenarios really does support the fact that homeowners need to be educated and informed on how to avoid remodeling disasters, understand how to hire a competent, ethical contractor and how to navigate the contracting process.
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