Thinking of home improvement? Check the license first before hiring a contractor!
By law, anyone in California who contracts for or bids on a construction project valued at $500 or more (combined labor and material costs) must be licensed by the Contractors State License Board (CSLB).
HOMEOWNER CHECKLIST:
Check out your contractor—
( ) Did you contact the CSLB @ 800-321CSLB, www.cslb.ca.gov or www.CheckTheLicenseFirst.com?
( ) Did you get at least three local references from the contractors you are considering?
( ) Did you call the references and personally view the contractor’s completed work?
( ) Does the contractor carry general liability insurance?
Building Permits—
( ) Does your contract state whether you or your contractor will pull necessary building permits before the work starts?
( ) Are the permit fees included in the contract price?
Double-Check the Contract—
( ) Did you read and understand your contract?
( ) Does the three-day right to cancel a contract apply to you?
( ) Does the contract identify when work will begin and end?
( ) Does the contract include a detailed description of the work to be done, the materials to be used, and/or equipment to be installed?
( ) Are you required to make a down payment? （The down payments should never be more than 10% of the contract price or $1,000, whichever is less unless there is a valid blanket performance and payment bond on file with CSLB）
( ) Is there a schedule of payments? (Only pay as work is completed, not before.)
( ) Did your contractor give you a “Notice to Owner” warning notice that describes mechanics liens and how to prevent them?
( ) Do you have changes or additions to your contract? (Remember that all changes must be in writing and signed by both parties to avoid disagreements.)
If the contractor offers a warranty for labor and/or materials, be sure to get that in writing.
ASK MORE:
Does your contractor have employees? Workers’ compensation insurance is required by law if the contractor has employees or workers.
Make sure the workers’ comp policy is current by checking the CSLB website so that the homeowner is not liable for the worker’s injury.
It’s a good idea to ask whether the contractor carries general liability insurance in case your property accidentally is damaged during the project.
How to prevent Mechanics Liens?
Consumers are required to receive a “Notice to Owner” warning about property liens. Anyone who helps improve a property, but is not paid, may place what is called a mechanics lien on the property.
A mechanics lien is a claim made against the property by the person who was not paid, and is recorded with the county.
Even if the contractor is paid in full, unpaid subcontractors, suppliers, and laborers involved in the project may record a mechanics lien and sue the property owner in court to foreclose the lien.
A property owner could be forced to pay twice or have the court sell the home to pay the lien.
Courtesy of Contractors State License Board: Department of Consumer Affairs
Liens also can affect a homeowner’s personal credit rating, and affect their ability to borrow and refinance.
Homeowners can protect themselves from liens by getting a list from the contractor of all subcontractors and material suppliers who will work on the project, along with the dates they will start and finish the work.
Material suppliers and subcontractors are required to give the property owner a “Preliminary Notice” of their right to file a lien within 20 days of delivering products/materials or 20 days of beginning the work.
Have subcontractors sign lien releases when their portion of the work is completed.
Another option for homeowners is to pay with a joint check that is payable to both the contractor and the subcontractor or material supplier.
Homeowners have 4 years to file a complaint with the CSLB about a faulty project.