How to Choose a Contractor

Why vetting matters more than the sales pitch

A confident sales pitch and a low bid are not evidence of quality. The contractors who are easiest to hire on the spot — because they showed up fast, quoted a low number, or asked for a large deposit to 'lock in' a price — are also frequently the ones consumers report problems with to state attorneys general and the Better Business Bureau.

Vetting a contractor is less about intuition and more about paperwork: confirming the business is legally licensed to do the work, that it carries insurance that protects you if something goes wrong, and that its past customers actually got what they paid for.

None of this guarantees a good outcome, but skipping it removes your main protections if something does go wrong.

How do I verify a contractor's license and insurance?

Most states require licensing for at least some categories of home improvement work, though requirements vary widely by trade and by state. Rather than taking a contractor's word for it, look up the license number directly on your state contractor licensing board's website, which will typically show whether the license is active, its scope, and any disciplinary history or complaints.

Insurance is separate from licensing. Ask for a certificate of insurance showing both general liability coverage and workers' compensation coverage, and consider calling the insurance carrier to confirm the policy is current rather than relying on a document alone. If a worker is injured on your property and the contractor is uninsured, you as the homeowner can potentially bear liability.

• Look up the license number on your state contractor licensing board's public search tool.
• Confirm the license covers the specific trade and scope of your project.
• Request a certificate of insurance for general liability and workers' compensation.
• Ask about bonding, if your state requires or offers it for the type of work.
• Check for any complaints, disciplinary actions or judgments on file with the licensing board.

Get more than one estimate for the same scope

A single quote tells you almost nothing about whether a price is reasonable. Getting estimates from several contractors — for the exact same written scope of work, not a vague description — lets you compare apples to apples and spot outliers in either direction.

An unusually low bid can mean corners will be cut on materials or permits; an unusually high one may include markups you can question. What drives cost differences is often materials quality, site conditions, permit requirements, disposal, and the contractor's overhead and schedule — not always workmanship.

Check references, licensing history and past work

Ask for addresses of recently completed, similar projects, and if possible, drive by or ask to see them in person rather than relying only on photos. Speaking with past customers about whether the contractor stayed on schedule, communicated well, and resolved problems is often more useful than reading online reviews alone.

State licensing boards, local building departments and consumer protection offices can tell you whether a contractor has open complaints, unresolved judgments or a pattern of licensing suspensions. This information is public in most states and worth checking before signing anything.

Insist on a detailed written scope before you sign

A trustworthy contract spells out the materials to be used (brand, model or grade where relevant), the exact work to be performed, who pulls permits, a start and estimated completion date, and how change orders will be priced and approved.

Vague language like 'standard materials' or 'as needed' leaves room for disputes later. If the scope changes once work starts, a written change order signed by both parties — describing the change and any price or timeline adjustment — protects both sides.

Avoid verbal agreements or handshake deals for anything beyond very minor work. If it isn't in writing, it's difficult to enforce.

Understand payment schedules and deposit norms

Payment schedules are usually structured around project milestones rather than paid entirely upfront: a modest deposit to begin, progress payments tied to completed phases (such as materials delivered, rough work done, or a specific stage finished), and a final payment held until the work passes inspection and you're satisfied. Some states cap how large an upfront deposit a contractor may legally request — check with your state licensing board or attorney general's office for the rule that applies where you live.

Be cautious of any contractor who insists on being paid in full, or a very large share, before work begins. Holding back a meaningful final payment until the job is complete and any required inspections pass gives you leverage if problems surface late in the project.

Ask about lien waivers on larger projects

In many states, subcontractors and suppliers who are not paid by the general contractor can potentially place a mechanic's lien on your property, even if you already paid the general contractor in full. Lien waivers are documents in which subcontractors and suppliers confirm they've been paid for their portion of the work, and they're a standard protection on larger projects.

For sizable jobs, ask your contractor for lien waivers as payments are made, and consider asking your title company, real estate attorney, or state resources on mechanic's liens how the rule works in your state before making final payment.

Know your cancellation rights

Federal law gives consumers a right to cancel certain contracts signed somewhere other than the seller's normal place of business — commonly called the Cooling-Off Rule — generally within a few days, without penalty. This can apply to contracts signed in your home, such as after a door-to-door sales visit. The rule has specific conditions and exceptions, so check current details with the Federal Trade Commission before assuming it applies to your situation.

Beyond that federal protection, your state or the contract itself may provide additional cancellation rights. Read the cancellation section of any contract before signing, and keep a signed copy for your records.