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Don't pay cash and other remodeling mistakes to avoid

Consumer Reports News: June 19, 2013 01:08 PM

While there are plenty of honest remodeling contractors out there, the field has its share of bad apples. We asked our Facebook fans to tell us the craziest thing their contractors told them. "Well, all windows leak a little," a poster wrote. "Don't worry about water coming through the electrical fixture," another wrote. Our favorite: "It would save time just to send you a court transcript." This checklist will help you avoid similar experiences with your kitchen remodel:

Don't chase lowball bids. Tough competition is inducing some pros to lower their profit margins with low bids and then make up the difference with shoddy work. Gauge the going rate for your project by getting at least three estimates, rather than jumping at the lowest estimate.

Check references. Reputable contractors are glad to provide names and contact information for satisfied customers. Try to check past jobs in person to talk with customers and see how the work is holding up. And always check the Better Business Bureau and your state's attorney general's office for complaints before making your pick.

Get a written contract. It should spell out in detail what will be done to complete the job, all associated costs, and a payment schedule. Don't sign a contract with a lot of open-ended amounts, or "allowances," for products and materials. Once the work is underway, stick to the terms, since contract changes can blow any budget.

Review the paperwork. That includes up-to-date license and insurance and workers compensation policies. (The Contractor's License Reference Site has information on licensing requirements in your state, plus a list of licensed contractors.) The contractor, not you, should get permits and give you a lien waiver when the job is done to keep suppliers from knocking on your door for unpaid bills. You'll need to get the final certificate of occupancy.

Don't pay cash. Write out the check to the contracting company, not an individual. Paying by credit card also adds a layer of protection. A reasonable down payment is 30 percent of the total project cost to be paid upon initial delivery of materials. Make final payments only when work is completed to your satisfaction. A reputable contractor won't pressure you if the job is not finished properly.

Now that the real estate market is heating up, more homeowners are considering remodeling projects. Help is on the way in the form of our kitchen remodeling guide, "Get the kitchen you've always wanted," including "Three magnificent makeovers." And check out our two-part bathroom remodeling guide, including "Bathroom remodeling trends and costs," and "Bathroom remodeling dos and don'ts."

Daniel DiClerico

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