The Stakes Are Higher Than Most People Realize
Hiring the wrong contractor is one of the most expensive mistakes homeowners make — and the symptoms often don’t appear until the contractor is long gone and the deposit is spent. Incomplete work, permits never pulled, substandard materials substituted without disclosure, and work that fails inspection are all outcomes that fall on the homeowner to remediate at their own expense.
The vetting process before signing a contract costs you nothing but time. The questions that follow are designed to distinguish contractors who will do what they say from those who sound identical in conversation but behave very differently on the job.
Question 1: Are You Licensed and Insured, and Can I Verify Both?
Every state has its own contractor licensing requirements, and a licensed contractor should be able to provide their license number for your immediate verification on your state’s contractor licensing board website. This verification takes 2 minutes and tells you whether the license is current, what work types it covers, and whether any complaints or disciplinary actions have been filed.
Insurance verification requires a certificate of insurance (COI) naming you as an additional insured for the duration of the project. This means their general liability insurance covers damage to your property during the project. Don’t accept a verbal assurance — request the COI directly from their insurer, not from the contractor.
Question 2: Who Actually Does the Work?
Many general contractors primarily coordinate subcontractors rather than performing work themselves. This isn’t inherently a problem — but it means you should ask who the subs are for each trade in your project, whether those subs are licensed, and whether the GC carries liability for subcontractor work under their contract.
It also means the contractor’s portfolio and reviews should cover projects done with their current subs, not a different crew from three years ago. Ask when each subcontractor was last used on a similar project and whether you can contact the homeowner.
Question 3: Will You Pull All Required Permits?
Unpermitted work is one of the most common and most consequential problems homeowners discover — often at the point of sale when an inspection reveals additions, electrical work, or structural changes that were never inspected. Unpermitted work must either be retroactively permitted (expensive and disruptive) or disclosed to buyers as a defect (damaging to price).
A legitimate contractor pulls permits as a standard part of the process and includes permit costs in the bid. A contractor who suggests ‘we can skip the permit to save money’ is offering to shift a significant legal and financial risk to you.
Question 4: What Does the Payment Schedule Look Like?
The payment schedule tells you a great deal about a contractor’s financial health and business practices. A standard schedule involves a modest deposit (10–20%), payments tied to specific project milestones, and a final payment (at least 10%) held until punch-list completion.
Contractors who ask for 50%+ up front often have cash flow problems. Contractors who ask for full payment at contract signing should be avoided entirely — this removes your primary leverage to ensure completion. Progress payments tied to observable milestones (framing complete, rough electrical passed inspection, cabinets installed) align ince