Red Flags That Could Save You Time, money, and Aggravation

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Red Flags That Could Save You Time, money, and Aggravation

MOST CONTRACTORS ARE HARD WORKING, HONEST PEOPLE. HERE ARE SOME TIPS TO AVOID THOSE WHO ARE NOT.

BE CAREFUL WHEN THE CONTRACTOR:

ASKS FOR A PAYMENT OF 1/3 OR MORE OF THE CONTRACT VALUE BEFORE WORK BEGINS

There are some instances where long lead items and specialty equipment must be purchased before work begins. Make sure you retain ownership and possession of those items, if you need to pay in advance.

Generally, payments should be made based on the amount of work completed, not an arbitrary payment schedule. When the right architect is involved, they will assist you in certifying that the work has been installed properly before making payments to the contractor.

Don’t make final payments until the Work is Substantially Complete. And get lien releases stating that the Contractor’s subcontractors and suppliers have been paid and are up to date. Don’t worry if you are sure what any of that means, I can help you with that.

Contractors are prohibited from asking for final payment until you get a Certificate of Occupancy. Consult an attorney if this happens to you. It may be a violation of the Consumer Fraud Act.

DEMANDS PAYMENT IN CASH

A better strategy is to set up a separate checking account for the project. Your bank can help you set this up to work with your home equity line or other type of loan. Your accountant can probably help you set up a separate account on Quickbooks or whatever accounting software you use, if you’re so inclined.

If you pay in cash, get a receipt that explains what you are paying for, when you paid, and the total amount paid. Don’t get involved in someone else’s scheme to cheat the IRS.

COMMUNICATES BY TEXT ONLY

Texting is a terrible way to keep track of decisions made during construction. Insist that all decisions must be made, and agreed to by all parties, in writing. Verbal communications should only be to discuss the details of a written agreement. Keep good records of every conversation. And put it in writing. And if you do get a text from the contractor, always follow up in writing / email. 

Don’t agree to swap one change for another. Make it two separate credits / charges. All “Change Orders” should be agreed to in writing, and should flow through the architect’s office.

When you hire an architect, you should communicate with the general contractor through their office. Don’t communicate directly with the general contractor’s subcontractors. And resist making side deals with the subcontractors.

Keep a good paper trail, just in case.

DOESN’T USE A WRITTEN CHANGE ORDER

If changes to the Work involve a change in the amount of money you pay, the amount of time a project will take, or in the scope of the work, make sure to get it in writing.

Typically, when an architect is involved, Change Orders should flow through the architect who checks to make sure everything is in order, and everyone agrees to the changes in writing.

It’s a good idea to insist that the contractor include a change of time, even if they say it is zero days, otherwise they may claim a delay was caused by your requested changes.

ISN’T REGISTERED WITH THE STATE

Unless they are exempt (hold another license like architect, engineer, plumber, or electrician), anyone offering home improvement services need to be registered annually as a Home Improvement Contractor with the New Jersey Division of Community Affairs. Ask to see their registration number and check online. Start here: https://newjersey.mylicense.com/verification/ . You should check both firm name and personal name, as they may be registered either way. You can check the status of your architect’s license here, too.

TELLS YOU DRAWINGS ARE NOT NECESSARY

If your project is of any significant size, or changing  the structural system, you will need a drawing prepared by a licensed architect.

Some work does not require architectural drawings to get a permit. And some work does not even require a permit. I personally think the recent changes that allow this are ill-advised and dangerous to the clients. I can tell you stories about my construction failure clients who came to me after things did not go as expected after spending tens of thousands of dollars and were left holding the bag.

SAYS THEY “JUST SO HAPPEN TO BE WORKING IN THE NEIGHBORHOOD AND CAN GIVE YOU A GOOD DEAL IF YOU ACT NOW”

They may be legitimate business people canvassing the neighborhood. But why take the chance?

Ask them for a business card. Ask for references and check them out.  Check the license plates on their truck. Check their home improvement registration number on the DCA’s website (see above.)

IF YOU HAVE ANY QUESTIONS, CALL ME. THE FIRST CALL IS FREE.

DRAWINGS WILL COST A LITTLE MORE.

David Del Vecchio, AIA, is a licensed architect in NJ, NY, CT, PA, MA, and FL; a Certified Interior Designer; a LEEDap Accredited Professional; an RCS Building Inspector; and an NCARB Certificate holder.

His practice includes custom residential design, professional office design, and commercial building design for busy, discerning clients who know what they want, have the financial means what they want, and want it done right the first time.

He also helps his clients (insurance carriers, attorneys, architects, interior designers, contractors, home owners, commercial landlords, and municipalities) resolve complicated construction claims.

“If it’s important to you, it’s a priority for me.”

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