Three Warning Signs You Should Avoid Working With A Contractor

Contractors are essential to house flipping, but if you’re careless about who you work with, you’ll get burned. Here are some red flags to watch for.

Unless you’re a hardcore “do-it-yourself” type, you’re going to work with a ton of contractors when flipping a property. Maybe you need to remodel a bathroom or fix a kitchen. Maybe the plumbing in the house is dead, or the electrical work is a fire waiting to happen.

Either way, you’re going to need to bring in some experts to lend you a hand. As with any business dealings, you need to be careful about who you work with here. If you immediately hire on the first person you find, you could well wind up turning your investment into a disaster.

Here are a few red flags that should have you turning the other way when considering a contractor:

They Insist You Pay Entirely In Advance

While it’s not uncommon for a contractor to request some money up-front before they start on a job, it should never be more than 10% of the job’s total cost. The rest should generally be paid out based on project milestones. Good contractors understand this, and will accept such an agreement without complaint.

As such, alarm bells should be going off in your head if a contractor demands you pay them everything before the job’s even done – because that means there’s really nothing to stop them from just taking the money and running.

They Try To Avoid Signing A Contract (Or Pressure You Into Signing Theirs)

Any contractor worth their salt understands that their word is their bond – and they also understand that different clients have different needs and different projects have different requirements. If you’re in talks with a contractor who seems to be allergic to actually signing anything (or worse, tries to foist their own contract onto you), walk away. Either way, you’re getting a raw deal.

They Aren’t Great At Communicating

Is the contractor you’re considering basically a ghost? Does it take them days to respond to a simple inquiry? Have you searched for hours online and found little to no information about them?

If a contractor can’t even call to let you know they’ll be late for an appointment – or worse, seems nearly impossible to get ahold of – they’re going to be a nightmare to work with. And if you can’t find any information about a contractor online? You might well be the target of a scam.

Closing Thoughts

If you do any work with house flipping, it’s inevitable that you’ll work with contractors. That’s why it’s essential that you learn to tell the good ones from the duds and scammers. After all, it’s your money, property, and livelihood on the line.

If you’re not going to be picky about it, who will?

Let’s leave off on a positive note – with a checklist that’ll help you tell when a contractor is good.
● They have a professional-looking website, complete with positive reviews and testimonials.
● You’ve heard of them before – and in a positive light.
● They’re flexible about their contract, and willing to accommodate your needs.
● They respond to your messages in a professional, punctual manner.
● Their records are completely up-to-date, and everything about their business is easily verifiable.
● They answer your questions accurately and concisely – and listen to your concerns.

 

About the author: Armando Montelongo, Jr. is a real estate mogul, mentor, philanthropist, and speaker. As the CEO of Armando Montelongo Companies, he specializes in real estate investing and teaching his students how to strategically invest in residential and commercial real estate. Through these courses, he helps students positively transform their lives.