Do not be intimidated by contractors. It’s your money, and you are hiring them to perform a service for you. Furthermore, don’t believe everything you are told. If, for example, someone stops by saying that they are doing work in your area, or that they have a load of driveway asphalt left over from another job, and they are willing to do your driveway for half price today to get rid of it . . . keep your money and say no thanks!
Finally, as the slide indicates, always get multiple bids. You will learn a lot about different ideas and techniques. Furthermore, you will be amazed at how much bids and prices vary.
Once you have obtained bids on the project, ask the contractors for local references. For example, they may have done work for Gabriel down the street, but was Gabriel happy with the work performed and the time frame that it took to complete the work? Were there cost overruns, etc.? Don’t be afraid to check with him.
Finally, if there have been complaints filed against a contractor, you may wish to investigate further, or simply find another contractor.
Many contractors operate as part of a larger business or company umbrella organization. Therefore, the larger companies will oftentimes offer to finance the project or improvements. While this may be convenient, it may not always offer you, the customer, with the best deal financially.
Therefore, it is important to check around with local banks, your credit union, or other financial institutions to compare loan costs. When comparing financing options, ALWAYS ask for the Annual Percentage Rate (APR). This rate is calculated by taking into account the actual interest rate, as well as all of the costs and fees to secure the financing. The APR allows you to compare apples to apples.
Note: The APR will generally be higher than the loan interest rate. However, a low interest rate on a loan product may actually cost you more, if there are excessive fees and closing costs. You need to compare!
No one likes to “read the fine print.” However, any time that you sign a contract, especially with a person or an institution that you do not know much about, it is imperative to know exactly what you are signing.
Some of the things to watch for in an agreement include: completion dates, payment schedules, prepayment penalties, and excessive late charges or penalties. Also, check and see whether you are financing insurance premiums up-front in your loan for products like credit-life insurance. If you decide to buy a credit insurance product, pay for it on a monthly basis instead.
Remember: If someone wants you to sign something today, because the price will go up tomorrow, or the deal is not available tomorrow, just walk away!
