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10 Things Contractors Won’t Tell You

1. License? What License?

With the economy rebounding, homeowners may be more likely to include remodeling projects in their budgets. Spending on home improvements has nearly recovered from the Great Recession, with an estimated $314 billion spent in 2014, up from a low of $276.5 billion in 2011, says Kermit Baker of the Joint Center for Housing Studies of Harvard University. That means more business for good and bad contractors alike. Unfortunately for consumers, telling the two apart isn’t always easy. Most states require some sort of licensing of contractors. But that doesn’t mean that everyone calling himself a general contractor has bothered to obtain this credential, experts say. “There are plenty of people out there with a pickup truck and a tape measure,” says Paul L. Sullivan, president of the Sullivan Company, a residential contractor in Newton, Mass., and chairman of the National Association of Home Builders (NAHB) Remodelers.

Regulations vary greatly: Some states require only commercial contractors to be licensed, while others mandate licensing for those who work on jobs over a certain dollar value. Local municipalities can also have jurisdiction over licensing. States with the most rigorous requirements include California, New Jersey and Florida, while states on the lax end of the spectrum include Colorado, Missouri and Wyoming. In 2012, unlicensed contractors ranked among the five fastest-growing sources of consumer complaints, according to the Consumer Federation of America (CFA).

Even when dealing with licensed pros, homeowners hiring a contractor should seek referrals from past and current clients, and ask to see the contractor’s work, both completed and in progress. “Everyone has their own perspective of what’s good,” says Tom Pendleton, president and owner of Pendleton Homes & Remodeling in McLean, Va. A client might give a contractor a glowing recommendation because he was a nice guy who got the job done ahead of schedule, when the actual work looks sloppy.

Another option: Use a service that vets contractors in advance. The website HomeAdvisor, for example, matches homeowners with contractors screened for licensing compliance, past criminal history and other issues. If you settle for a boilerplate contract, your renovation may disappoint you.

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Michael B. Bell | Home Sales Done Right