Money Downer

Submitted by ub on

A neighbor just approached me to ask if he should buy the unit he is renting in our condominium. I told him the building is great, but the board is not effective and the management company is even worse.

I added that there is mush work to be done and that in NYC everything is done by the book.

Also, my daughter Sabrina is an interior decorating expert and she has taught me a thing or two. Here my suggestions to hire a contractor, while keeping your budget sanity and costs under control. ‪Lets hope you do not get stuck in a money pit.

https://youtu.be/nJPju1f6p0E

Know What You Want Before You Get Estimates. First things first: "Start with a plan and some ideas," Hicks says. "Don't start by talking to contractors." You'll get a more accurate estimate if you can be specific about what you want to be done and the materials you would like to use to make it happen.

Ask friends, relatives, and co-workers for references. People in your neighborhood who have done similar projects are great resources. If you know anyone in the building trades, ask them as well. Employees of local hardware stores may also be able to provide contractor referrals.

Interview at least 3 contractors. Ask a lot of questions and get a written proposal with an estimate from each. When you compare bids, make sure each one includes the same materials and the same tasks, so you're comparing apples and apples. Dan DiClerico, smart home strategist and home expert for HomeAdvisor, recommends reaching out to as many as 10 contractors, but a detailed conversation and estimate from at least five will help you feel more confident as you compare options and make decisions about the project. It really is such a valuable part of the process from education and experienced perspective.

Be realistic about availability. A contractor's availability can depend on the time of year and where you live, but the best contractors have consistent work, so expect to wait a few months for your project to start. "Three months is going to give them time to hopefully finish up their current project and get yours on the calendar, but if you can plan it six months out, that's even better."

Ask what work will be performed by their subcontractors. A large renovation may require the contractor to bring in subcontractors for specialized work such as electrical, plumbing or detailed carpentry. You'll want to know when outside workers will be in the home, and you also want to know that your contractor will manage and supervise their work. Homeowners really should have as little interaction with the subcontractors as possible.

Choose the best contractor for the right project. Someone who did a good job tiling your neighbor's bathroom isn't necessarily the right person to build an addition to your home. Aim to find a company that routinely does the kind of project you want to be done. You don't want them to use you as a guinea pig.

Check licenses, complaints, and litigations. General contractors and most subcontractors should be licensed, though the procedure varies by state and municipality. Check your state disciplinary boards, Better Business Bureau and local court records for problems. Ask the contractor for a copy of his or her license and copies of the licenses of the subcontractors who will be involved in the project.

Check references. Talk to both clients and subcontractors, who can tell you if the contractor pays them on time. Ask previous clients if the contractor's estimate was close to the final cost, if they got along with the project manager and if it's possible to see closeup photos of any completed work.

Read online reviews. Read reviews on sites like Angie's List, HomeAdvisor, Yelp, and Google to make sure the contractor is the right person for your job and will work well with you. Keep in mind that reading reviews is not a substitute for checking references. While a series of negative reviews over a long period of time should raise a red flag, one negative review or particularly nasty comment may not provide an accurate picture of the business.

Sign a detailed contract. Make sure your contract spells out exactly what will be done, including deadlines, payment schedule, the exact materials that will be used down to the model number and who will provide which materials. If the builder's contract is not detailed enough, write up your own or provide addendums. Any change in the project, whether you change your mind about products or request additional features, should generate a written change order that includes the new work, materials, and cost.

Get the proper permits Nearly all home renovation projects require permits. Many fly-by-night companies, as well as some licensed contractors, will suggest that the job can be done without permits to save money, or they may not even broach the topic. Not only could that violate local ordinances and subject you to fines if you're caught, it means the work will not be inspected by the city or county to make sure it's up to code. Unpermitted work can also cause problems when it's time to sell your home. Be wary of contractors who ask you to obtain the permits that's the contractor's job.

Don't pay more than 10 percent of the total Before the Job. You don't want a contractor to use your money to finish someone else's job. The contract should include a payment schedule and what triggers each installment to ensure you're not paying for work on schedule when the contractor is behind the projected timeline. Expensive materials needed early on may require more deposit upfront to cover the cost, but that should be laid out in your payment schedule.

Budget for unexpected charges. No matter how careful you and the contractor are in preparing for the job, there will be surprises that add to the cost. They can't see through walls, Expect to spend at least 10 to 15 percent more than what is estimated in your contract.

Negotiate ground rules. Discuss what hours the contractor can work at your home, what kind of notice you'll get, what bathroom the workers will use, where they will park and what will be cleaned up at the end of every workday.

Talk to the contractor frequently. Regular talks with your contractor are typical, and you may even speak daily when discussing a change order. If you see a potential issue with the work, speak up immediately. Something that is done wrong will be harder to fix later after your contractor has packed up and moved on to the next job. But you don't want to micromanage. You should hire a contractor you can trust to give honest updates and oversee work.

Verify insurance coverage. In case of accidents or weather events that cause damage to your home while work is being done, know what is covered by your homeowners' insurance and what is covered by your contractor's business insurance. Get a copy of the company's insurance policy.

Get lien releases and receipts for products. If your contractor doesn't pay his subcontractors or suppliers, they can put a mechanic's lien against your house. You want copies of receipts for all the materials, plus lien releases from all the subcontractors and the general contractor before you pay. You can ask for some of those when you make payments that cover completed subcontractor work.

Don't make the final payment until the Job Is 100 percent finished. Less-reputable contractors could finish most of the job and then move on before they get to the final details. Don't make the final payment until you are completely satisfied with the work and have all the lien releases and receipts. Make this clear in your payment schedule.

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