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Did you know…
… that if you hire an unlicensed contractor you are at
risk?!
The State of Michigan requires all contractors in the
building trades to be licensed.
In order to get a license the State requires a person to:
- Take an extensive knowledge test on the trade he wants
to do business in.
- Have his credit and criminal records history checked in
order to determine whether or not he pays his bills and
how he handles his finances, including any judgments by
the IRS etc.
- Requires payment into a Lien Recovery Fund, which protects
the property owner against contractors who don't pay their
sub-contractors or job materials bills.
I'm sure that you must have caught a news story
from some media source describing an unsuspecting property
owner who got ripped off by a contractor who either took a
deposit and never showed up or did part of the work and never
finished. Unfortunately these kinds of incidents give the
legitimate contractors an undeserved black eye. And the way
homeowners can protect themselves is to do their homework
when selecting a contractor.
Did you know that a supplier who sells materials
on credit to an unlicensed contractor for your property can
lien your property or sue the property owner for the amount
of the materials if those bills aren't paid? And, did you
know that sub-contractors / workers who work on your property
for an unlicensed contractor can lien your property or sue
the property owner for wages due them if the contractor does
not pay them? You can reduce these risks by doing business
with licensed contractors who are working within the licensing
and Lien Recovery Fund requirements.
Before you hire a contractor ask him to show you
his contractor's license, either in the form of a wallet ID
card or full size certificate. It will help you feel at peace
knowing whom you are dealing with.
A word about insurance: make sure when hiring
a contractor you ask to see a certificate of insurance for
workman's compensation and liability.
Did you know that…
- If you hire a contractor that has no insurance and one
of his workers gets hurt the injured worker could sue the
property owner for damages!
- And if the contractor has no liability insurance: guess
who could be stuck with the bill if for example a ladder
falls on the house or building next door or something gets
damaged by a freak accident.
These things of course are not likely to happen
to you, but they do happen! Be educated about who you hire
to do a job. There are a lot of guys running around unlicensed
and uninsured trying to undercut the legitimate contractor's
prices. Don't be fooled by cheaper prices, there are risks
involved. Hiring a good company will lessen the risks!
Here are a few tips for hiring a contractor:
- Get a detailed written estimate. Don't accept a price
written on the back of a business card or something scribbled
on a piece of paper.
- Don't rush the time allowed for an estimate. It is in
the best interest of both parties to take the time to go
over the details.
- Make sure the contractor's business address and phone
number are on the estimate. If either one is not you should
wonder why they don't want you to know!
- Check with your local Better Business Bureau to see if
they have any unresolved disputes.
- Ask for a couple references. Although they don't usually
give you bad ones it will still give you an idea of whether
they have any.
- Most contractors require a deposit. It's just the nature
of the business! If you're leery about doing so, offer a
smaller good faith deposit with the remainder to be paid
on the starting day.
- Sign a written contract, this protects you and the contractor
and helps keep things honest.
- Ask to see their contractor's license.
- Ask to see their liability insurance certificate and workman's
comp if they have employees.
- Last but not least relax, it's not as hard as it seems.
Contractors are people too and they should understand the
idea of checking some one out. After all we do it too when
hiring someone for a job at our homes.
Alex Boozenny
President
Action Painting Company
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