How to Hire a Contractor: 10-Step Checklist to Avoid Scams
Quick answer
To hire a contractor safely: get written estimates, check the license and insurance, call recent references, put the scope and price in a written contract, and never pay the full cost upfront or in cash. FTC guidance warns that scammers ask for everything upfront or cash only; pay the balance only when the work is done.
Key takeaways
- Get several written estimates and compare scope, not just price.
- Verify the license with your state and ask for proof of insurance.
- Never pay everything upfront, and never pay in cash.
- Red flags: door-to-door offers, cash-only, pressure to decide now.
The 10-step contractor hiring checklist
- Define the job. Write down what you want done, with photos and measurements.
- Get recommendations from friends, neighbors, and trusted review sites.
- Collect written estimates from more than one pro, each describing the work, materials, completion date, and price. Don't automatically choose the lowest bid; ask why prices differ.
- Verify the license with your state or local licensing board where required.
- Ask for proof of insurance, including liability and workers' compensation.
- Call recent references and ask whether the job finished on time and on budget.
- Confirm permits. A competent contractor pulls required permits before starting.
- Get a written contract with the contractor's name, address, phone, and license number, plus the scope, materials, price, start and finish dates, and warranty. Make sure all blank spaces are filled in.
- Agree on a payment schedule tied to progress. Don't pay the full amount upfront, and keep the final payment until the work is complete.
- Keep records of the contract, change orders, payments, and photos.
How much should you pay upfront?
The Federal Trade Commission warns that scammers ask you to pay for everything upfront or only accept cash. Its advice: don't pay the full amount for the project upfront, and never make the final payment until the work is done and you're satisfied with it.
Some states limit how much a contractor can ask for as a down payment, so check with your state or local consumer protection office. And if you sign a contract in your home rather than at the contractor's place of business, the FTC notes you may have a right to cancel within three business days.
Red flags of a contractor scam
Be cautious of a contractor who:
- Knocks on your door offering a deal, especially after a storm
- Says they have leftover materials from a nearby job
- Accepts only cash or asks you to pay everything upfront
- Pressures you to decide immediately
- Won't put the price and scope in writing
- Asks you to pull the permits yourself
- Pushes you toward a lender they know to finance the work
If you suspect a home repair rip-off, contact your state attorney general's consumer protection division.
Questions to ask before you hire
- How long have you been in business, and are you licensed for this work?
- How many jobs like mine have you done in the past year?
- Will you use subcontractors?
- Who will be on site, and who is my point of contact?
- What warranty do you offer on labor and materials?
- How do you handle changes to the scope or price?
A faster option for everyday repairs
For larger remodels, the full checklist above is essential. For everyday repairs, from plumbing and electrical to handyman work, Blixxy makes several steps simpler. Pros pass a background check through Checkr, you set the price before anyone accepts, and payment is held until you approve the work. You can review a pro's profile and leave a review after every job.
Frequently asked questions
What should I check before hiring a contractor?
Check the contractor's license, insurance, references, and complaint history, and get the scope, price, and schedule in a written contract.
How much should I pay a contractor upfront?
Never pay the full amount upfront. The FTC notes that some states limit down payments, so check your state's rules, and keep the final payment until the work is done to your satisfaction.
Should I always choose the lowest estimate?
No. The FTC advises against automatically picking the lowest bid. Compare scope, materials, and timelines, and ask contractors to explain price differences.
What are signs of a contractor scam?
Common signs include door-to-door offers, cash-only payment, pressure to decide immediately, refusing to put terms in writing, and asking for the full cost upfront.
Sources
- How To Avoid a Home Improvement Scam — Federal Trade Commission
- Hiring a Contractor (consumer brochure, PDF) — Federal Trade Commission via GovInfo
- Home Improvement consumer checklist — Connecticut Department of Consumer Protection
Prices are typical U.S. ranges for planning and vary by location and job. The Blixxy editorial team writes practical guides on home repair costs, hiring local pros, and home maintenance, using public data from government and industry sources.