@Liz Barcelos, hiring reputable contractors. Admittedly, this takes time and many projects, but nothing beats a contractor that actually WANTS to do a good job and cares about their reputation. You can typically find these contractors because they are the ones that are NOT available to start tomorrow. In general, I have found that the contractors that properly schedule their time at the front end, are also the ones that care about all aspects of the job.
Second, a fairly sizable part of the total cost should not be paid until everything is complete. And no draws based on percentage of work complete. Ideally at least half of total bill is due upon completion, but could be 1/3 depending on size and scope of job.
Other options, which can be combined with the other two, are sticks and carrots. Let the contractor create their timeline based on your scope. Then just like your budget, build in a buffer. If they are done on or before THEIR date, they get some bonus. But if they are not complete within a certain time after THEIR deadline, there are daily penalties. For example, if the contractor says it will take 4 weeks, their bonus is paid if they are done on or before 4 weeks and penalties start once 6 weeks has passed.
My residential construction experience is minimal, however, I have served in the capacity of owner, owner rep., and GC on some respectable size commercial build projects. For these projects, I have always incorporated the appropriate AIA document (A-Series) and required the contractor(s) or GC to use them. My first project as GC required these, and I found them very detailed and helpful for my projects when I was on the owner or owner-rep. side of the construction.
Might be overkill for a small rehab project, but if you are doing enough, look into purchasing these, and I think you will find them helpful.
@Liz Barcelos, hiring reputable contractors. Admittedly, this takes time and many projects, but nothing beats a contractor that actually WANTS to do a good job and cares about their reputation. You can typically find these contractors because they are the ones that are NOT available to start tomorrow. In general, I have found that the contractors that properly schedule their time at the front end, are also the ones that care about all aspects of the job.
Second, a fairly sizable part of the total cost should not be paid until everything is complete. And no draws based on percentage of work complete. Ideally at least half of total bill is due upon completion, but could be 1/3 depending on size and scope of job.
Other options, which can be combined with the other two, are sticks and carrots. Let the contractor create their timeline based on your scope. Then just like your budget, build in a buffer. If they are done on or before THEIR date, they get some bonus. But if they are not complete within a certain time after THEIR deadline, there are daily penalties. For example, if the contractor says it will take 4 weeks, their bonus is paid if they are done on or before 4 weeks and penalties start once 6 weeks has passed.
@Liz Barcelos The best way I have found is to periodically walk the property and check progress yourself until your comfortable with the GC. If you cannot physically walk it, progress photos at the end of every week will help you know where the project progress is, and the GC knowing that your either going to show up or knowing the need to "prove it" at the end of every week should help keep them on track.
Building in milestones into the schedule with completion bonus/penalties is a great tool as well. If they miss a couple milestones early on, you may be able to get out in front of a bigger problem before it gets to sideways on you.
To @Evan Polaski point, Hold off on payment until you can verify the work has been completed through pics, and or a walk. Only pay for work completed. Hold 5% for 2 weeks after substantial completion to keep them motivated if they need to come back and fix something.