[quote=george]There are many good, honest contractors, but in my experience no other profession has as high of a proportion of incompetent and/or crooked practitioners.
– Make sure that they are not going to hire sub-contractors to do the work unless you are totally comfortable with the sub-contractors. Remember that you are ultimately responsible for the sub-contractors being paid, even though you did not have a contract with them, or even knew that they were sub-contractors when they were doing the work. The sub-contractors can put a lien on your house if the contractor doesn’t pay them (even if you can prove you paid the contractor in full).
– It’s illegal for a California contractor to ask for more than 10% or $1000 up front. It doesn’t matter if they have to order materials that exceed this amount. If they don’t agree to this they are probably broke.[/quote]
Good points. Some additional info on this.
The $1k or 10% – it is the LESSER of these two that is the max the contractor can ask for up front. NEVER pay a contractor in advance of work – or you’ll be in the hell that we are – trying to recover money long gone, through arbitration. Only make progress payments on completion of milestones.
If your contractor says they need the money up front to buy materials – offer to issue a joint check -made payable to the contractor and the supplier. Or offer to pay for the materials directly to the supplier. Never advance money for materials without some form of insurance that the money will go for the materials.
If a subcontractor issues you a “20 day notice” – pay attention. It must be delivered to you by certified mail – it is invalid if it isn’t. It starts the clock ticking on work delivered by the sub from 20 days prior to delivery of the 20 day notice. In other words – it can only look back 20 days… if a sub doesn’t issue a 20 day notice – they can’t collect or lien the client. If the sub issues the 20 day notice late in the process – they may not have as large of a claim since it can only look back 20 days from the notice and doesn’t cover work done prior to that.
I learned all this the hard way… Fortunately for us (but unfortunately for the unpaid subs), when our contractor abandoned the job, many of the subs waited too long to issue the preliminary 20 day notices. As far as I know, the subs were never paid, but they couldn’t lien us or collect from us.
