How to make sure a contractor is not ripping you off.

6 Replies

How do you make sure a contractor is not ripping you off when purchasing materials. How do you verify what they purchased and what they used. How do you make sure they dont buy something and then return it? 

As a contracto they should be able to supply receipts for materials purchased and used. Also get multiple estimates. In my opinion I wouldn't go for lowest but usually the mid range contractor. You get what you pay for. 

@Kyle Bentz  Being able to see and inspect the work is important.  This is one of the difficulties of investing out of state.

Get recommendations on good contractors from other investors.  You are looking for people who have used contractors over and over again.  Also, as @Nicholas Davis  said, get multiple bids.

Finding good contractors is very difficult.  If you do lots of stuff, you will have the chance to use a number of different contractors, you will get ripped off by some, and you will settle on a few that are reliable and reasonably priced.

@Kyle Bentz  Build a relationship with the contractor prior to send them to a store with your card or doing phone orders.  Connect the dots and see how the perform.  

If that doesn't work, threaten him.


Frank

Kyle,

How is your contract set up with the contractor? Are you paying for the labor and material?

Or is the contractor going to pay for the materials and then you reimburse him? 

What I do for my jobs is I pay for almost all the materials and contractors only get paid for the labor. And I buy almost everything at Home Depot. My contractors go to HD and pick out everything they need for the job and someone from Pro Desk calls me to confirm the purchase and tell me what the contractor is buying. 

What I love about buying at HD is that on their website after you create an account, you can see pictures of what was bought with quantity and pricing jnfo. I quickly scan the invoice with pics to make sure everything looks good on the purchase. 

Hope this helps.

Sharad

Medium logoSharad M., REsimpli | [email protected] | 619‑786‑3482 | http://reSimpli.com | Podcast Guest on Show #155

Originally posted by @Kyle Bentz :

How do you make sure a contractor is not ripping you off when purchasing materials. How do you verify what they purchased and what they used. How do you make sure they dont buy something and then return it? 

One way to avoid this is by structuring the Contractor Agreement and Scope of Work so the contractor is responsible for all labor and materials, so any material cost will be included in his original proposal.  

Then you avoid reimbursing your contractor for materials used (or not used)...

David Robertson | 816‑388‑0197 | http://www.houseflippingspreadsheet.com