How to vet a contractor: the 14-point checklist

Contractor vetting is the highest-ROI two hours you'll spend on a home project. Most bad outcomes — abandoned jobs, code violations, warranty disputes, payment disputes — come from skipping three or four basic checks. Here's the full checklist.

Before the quote: 4 checks

1. License verification. Every state with contractor licensing has an online lookup. Get the license number before signing anything. Confirm it's (a) currently valid, (b) in the correct trade classification for your work, (c) not expired, (d) not subject to pending disciplinary action or complaints. If your state doesn't license your trade (some states don't require plumber or electrician licenses statewide), check with the municipality. If you can't verify a license number, that's the answer.

2. Insurance verification. A proper contractor carries general liability (minimum $1M typical) and workers' comp. Ask for a Certificate of Insurance (COI) addressed to you. Then — critically — call the insurance company on the COI and verify it's current. Scam contractors sometimes forge COIs from expired policies.

3. Physical business presence. A real contractor has a real business: a physical address, a permanent phone number, a legitimate website (or at least a consistent Google Business profile), and a fleet with the business name on the truck. A P.O. box address, a phone number that rings to a cell, and a rental van without branding are the profile of an itinerant operator who may be gone by the time you discover problems.

4. Reviews across at least three platforms. Don't rely on reviews from one source — they can be manipulated. Cross-reference: Google Business Profile, the contractor's state licensing complaint database, Yelp, BBB, and Reddit (search "[contractor name] [city]" — local subreddits often have candid discussions). Look for patterns across platforms, not individual reviews.

At the quote stage: 4 more checks

5. Written proposal with itemized costs. The proposal should specify: scope of work, materials (quality level, brands where applicable), labor line items, start and completion dates, payment schedule, warranty terms, change-order process, and what happens if unforeseen conditions (rot, code upgrades) appear. A vague "scope to be determined" proposal is how contractor-vs-homeowner disputes are born.

6. Permit responsibility in writing. The proposal should specify who pulls the permit. For anything subject to permitting, the contractor should pull it (with you as property owner listed). Homeowner-pulled permits are a trap: the homeowner becomes legally responsible for the work as if they did it themselves, which shields the contractor from inspection failures. If a contractor pushes you to pull the permit, understand why before agreeing.

7. Three comparable quotes. The price comparison is half the value. The other half: talking to three contractors gives you a baseline for what normal looks like for your job. A quote that's 30% below the others usually means something is missing (usually code-required items). A quote that's 30% above usually means markup padding. The middle quote, from the most transparent contractor, is often the best choice.

8. No deposit over state limits. Every US state has limits on how much a contractor can collect upfront for residential work. California: 10% or $1,000, whichever is less. Many states cap at 33%. A contractor demanding 50% upfront is either ignorant of the law (bad) or knowingly violating it (worse). Legitimate contractors are paid in stages tied to milestones.

Before signing: 3 checks

9. Contract terms for schedule and delays. The contract should specify the completion date and what happens if the contractor misses it (typically a daily penalty clause or schedule remedy). "We'll start as soon as we can" is not a schedule.

10. Warranty terms in writing. What's warranted, for how long, by whom. Labor warranty is typically 1 year. Manufacturer warranties on materials pass through (varies). If "everything is warranted for 5 years" sounds good, read what's actually covered — usually a lot less than the sales pitch.

11. Change-order process. Almost every non-trivial project has changes — you decide you want a different fixture, a piece of rot is discovered, the permit requires an upgrade. The process should be: contractor writes a change order with updated scope and cost, you sign before work continues, the original contract is amended. Verbal change orders are where disputes live.

During the job: 3 checks

The single most effective vetting tool isn't a license lookup — it's calling three recent clients from the past year and asking how the work held up.

12. Payment tied to milestones, not time. Pay on completion of identifiable work: "demo complete," "rough-in passed inspection," "final cleanup complete." Not weekly, not monthly, not based on how much time has passed. If the contractor wants weekly progress payments regardless of progress, they may be pulling money off your job to pay for previous clients' materials — a cashflow ponzi that ends badly.

13. Lien releases for subcontractors and suppliers. When a contractor pays a subcontractor or supplier with the money you paid, you're protected from lien claims. When they don't pay, the subcontractor or supplier can place a lien on your property. For jobs over $5,000, ask for lien releases with each progress payment.

14. Walkthrough at completion. Before final payment, walk the job with the contractor and create a punch list of any remaining items. Hold final payment — typically 10% of the contract — until punch list is complete. The moment you make final payment, your leverage to get anything finished drops to near-zero.

If something goes wrong

If a contractor has taken payment and isn't performing:

1. Document everything. Photos, texts, invoices, the written contract. Save originals.
2. Send a written demand letter via certified mail. Specify what's incomplete and a reasonable deadline (2 weeks typical).
3. File with the state licensing board. This is often the fastest resolution mechanism — the threat of license suspension motivates contractors more than almost anything else.
4. Small claims court for amounts under your state's limit ($5,000–$10,000 typically).
5. Consumer protection bureau at your state attorney general's office for larger issues.

Don't pay more to "fix things" with the same contractor. The relationship is broken.

The absolute deal-breakers

If you see any of these, walk away and don't argue:

• Unwilling to pull permits.
• Cash-only payment.
• Deposit demand over state limits.
• Can't produce a valid license number.
• No insurance certificate.
• No written contract.
• Pressure tactics ("this price is only good today").
• Door-to-door solicitation after a storm.

Most contractor disasters come from homeowners ignoring one or more of these.

Related

• 7 signs a repair quote is overpriced
• The hidden fees in a typical repair quote
• How to get 3 contractor quotes