Hiring a Contractor
Warning Signs That a Contractor is Unlicensed
- Unlicensed contractors may request a large down payment in cash, or a check made out to cash prior to doing any work. They may even offer to drive you to the bank to obtain these funds.
- Unlicensed contractors will ask you to obtain the permit or advise you that you don’t need a permit. If you would just call the Building Safety Division at 269-683-2374, the staff will be more than happy to advise you whether or not a permit is required for your particular job.
- Unlicensed contractors often will not provide the consumer with a written contract or guarantee.
- Unlicensed contractors will not have a valid contractor’s number on their contracts or advertisements.
- Unlicensed contractors often want to do the construction work on weekends.
- Unlicensed contractors may promise you a large discount if you sign up immediately.
- Beware of a contractor who claims to have just completed a job down the street and has materials left over from that job who offers to do the work cheap.
- Beware if the contractor has a post office address with no street address, or gives a local motel as his address.
- Beware of people wanting to do a free home inspection. Always verify that they are a licensed contractor prior to allowing them to do such inspections.
- Beware of people soliciting to do roof repair, asphalt or texture coating of driveways.
- Beware of contractors who want to use your home as a demonstration model.
- Unlicensed contractors usually do not carry general liability or worker’s compensation insurance.
- Unlicensed contractors normally target the elderly, uninformed, young and inexperienced.
- Unlicensed contractors normally use unmarked vans or trucks.
- Often, unlicensed contractors will become abusive and threatening when you refuse to do business with them. CALL THE POLICE DEPARTMENT IF THIS OCCURS. 269-683-1313
- Do not give a deposit or sign a contract until you have confirmed that the contractor is licensed. Ask the contractor to leave the contract with you and come back the next day. This gives you the time to look it over without being pressured or intimidated. Also, you can contact the Building Safety Division if you suspect a possible problem or if you would like to check if the contractor has the proper license. The number to call is 269-683-2374.
Things to do Before Signing a Contract
- Always get three (3) bids or estimates before signing a contract or giving the contractor a deposit.
- Call the Bureau of Commercial Services, Contractor Licensing Division 900-555-8374 for licensing verification (Monday through Friday, 8:00 am - 5:00 pm ), or verify online to inquire if a contractor has a valid contractor’s license.
- Each contractor should have a contractor’s number listed on his contract that you can use to verify with the Licensing Division.
- Make sure the work to be done is in writing on the contract regardless of how minute.
- Make sure all warranties are listed on the contract - not verbal.
- Make sure you read all the fine print on your contract and understand it, or ask your contractor to explain before you sign the contract.
- Include in the contract that the contractor will supply you with a Contractor’s Final Affidavit (of no liens) when the job is completed and at the same time you give him the final payment.
Five Steps to Selecting a Contractor
Most Michigan contractors are hardworking, honest, skilled and dependable. Before you hire a contractor for new construction or home remodeling work, the City's Building Safety Division recommends the following steps:
- Ask to see the contractor's license and write down the license number for future reference. All licensed contractors should present you with a business card that should contain the contractor's license number. Check with the Michigan Department of Consumer & Industry Services to verify the validity and current status of the contractor's license. Further information regarding contractors may be obtained via E-Mail. In addition, operator assistance is available for a fee of $1.50 per minute, plus possible line charges at 900-555-8374. You also have the option of obtaining written verification by sending your request along with a $5.00 check or money order made payable the State of Michigan to: Michigan Department of Consumer and Industry Services, License Verification Unit, P.O. Box 30189, Lansing, MI 48909 .
- Get recommendations from friends and neighbors. Use a local, well-established contractor. Ask the contractor to give you references. Then call the references, ask questions and take a look at the contractor's previous work.
- Ask the contractor if the company is insured against claims covering worker's compensation, property damage and general liability.
- Get all estimates in writing! Estimates should be very specific and should include exactly what services you'll be getting for the estimated cost. If a bidding process is used, ensure that the estimated costs are based on the same set of specifications. Get a written contract that specifies all work to be done and make sure a completion date is included on the contract.
- Be sure to see the building permit before work starts. The building permit should not be in your name, but rather the name of the contractor. Never obtain the building permit yourself for work being done by a contractor. By doing so, you assume all the risks and it will be difficult to recoup money for inferior work.
NOTE: All electrical, plumbing and mechanical (heating and/or air conditioning) work must be done by a Michigan Licensed Contractor. Property owners may do their own work but only for their own residence. Property owners may not complete electrical, plumbing or mechanical work on rental or commercial property unless they hold a Michigan State Contractor's License and they obtain a building permit prior to the start of the project
For more information on contractor requirements, contact the Building Safety Division at 269-683-2374.