Qualifying Your Contractor
Selecting the Contractor who will build your house will likely be one of the largest financial decisions of your life. A poor decision could have ramifications that will effect not only your financial status but your quality of life for years to come. That is why when selecting your contractor due diligence is a must. Please find below a list of the largest factors that should be considered when selecting a General Contractor.
1) California Contractors License – It is illegal to perform any construction work valued in excess of $500 in the state of California without a valid and active California License. Ask to see the state issued pocket license and a photo i.d. it can then be verified as an active license at the state contractors license board website www.cslb.ca.gov or at the toll free phone line 1-800-321-CSLB (2752) Please be aware if you hire an unlicensed contractor you will have no legal recourse if the building fails, leaks, collapses, or someone is hurt on the jobsite.
2) Insurance – Any Contractor who has employees is required by state law to carry Workers Compensation Insurance. Any helper is an employee. Although not required by California state law any reputable professional contractor will carry General Liability insurance as well. Always ask for proof of insurance and make sure the insureds name on the form matches the contractors name exactly. Make sure the dates on the insurance form cover the length of your project. If you do not verify insurance and there is an personal injury accident you can be held liable. If there is a structural failure or unforeseen personal injury from a jobsite visitor or outside agency without General Liability insurance you can be held liable. Make sure the amount of policy coverage is sufficient to cover your construction budget.
3) A licensed California contractor cannot ask for a deposit of more that 10% of the project cost or $1000.00 whichever is less. All payments should be based on a progress payment system, pay only for work what has been done. the only exception being special order items in which the vendor requires a deposit, such as windows, doors, large cabinet orders, always receive a receipt or lien release from this vendor.