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What Consumers should look for in a Contractor
Your home is probably the most expensive investment
that you will ever make. Before you spend thousands of dollars on building
or remodeling your home, you need to do your homework and under stand
your role as the consumer. The following information is provided to
help you with the process of selecting a contractor:
- Your first step is to come up with
a plan
- Shop for Quality – Not the
Lowest Price
- Important Information on Remodeling
Contracts
- Obtaining Building Permits
- What Consumers Should Know about
Their Contractor’s Insurance Coverage
- Service and Warranties
- Resolving Disputes
- Arbitration
- Court Action
- The Guaranty Fund- A Note for
the Remodeling Consumer
Your first step is to come up with
a plan
Think your building project though
from start to finish. Consider special needs that you and your family
may have, or may have in the future. You may want to consider a professional
architect or designer to help you come up with a plan and a realistic
budget.
Think about the materials and finishes you may want
to use, such as the siding, roofing, kitchen cabinets, etc. A visit
to the local lumberyard or home center may be of some help. You may
find home magazines helpful, as well as talking with friends and neighbors
about what they have done. In this day in age of the internet, information
is just a click away. All of the major building suppliers have web sites
with loads of information that you will find helpful.
List your ideas and your suggestions. Make a rough
sketch of what you had in mind for a floor plan. This will give us a
good starting point from which to start making your dream into a reality.
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Shop for Quality – Not
the Lowest Price
The best way to learn about your contractor is to record
as much information as possible about their reputation and the quality
of their work. We will gladly give you a list of homeowners like yourself
that trusted us to turn their dream into a reality. You can drive by
these homes and view the quality work that was done on these homes.
Talk with the local Building Department to verify that we do quality
work and are fully licensed. Contact the local Home
Builders Association, and verify that we are a member in good standing
and adhere to their Code
of Ethics. Contact the State Contractors Registration Board to verify
that we are a fully licensed Building
Contractor in Good Standing. To obtain a Massachusetts
Construction Supervisors License, builders must demonstrate a though
exam performance and prior construction experience. They must posses
the necessary qualifications to perform and oversee the construction,
renovation, and repair of the structural elements of buildings, otherwise
known as your home. Remodeling contractors must also register with the
state as a remodeling contractor.
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Important Information on Remodeling
Contracts
While it is advisable to put all contracts in writing
regardless of the cost of the work being done, it is the Massachusetts
state law that any home improvement contract over $1,000 must be in
writing. If a contractor violates this provision, his or her license
may be suspended or revoked, as well as a possible fine and criminal
prosecution. Valid remodeling contracts over $1,000 must contain several
provisions and provide some consumer cautions and special notifications.
For instance, all contacts must provide complete identification of all
parties involved with the proposed job, including the registration numbers
of the contractor. It must also include:
- A complete description of the work to be done
- A detailed list of specifications and materials to
be used
- Starting and completion dates
- The total price of the work to be done and a payment
schedule
- A copy of the contractors insurances
- Signatures of all the parties involved
It must conspicuously display notifications about a
Consumers Right to cancel the contract within three days of signing,
any information on applicable warranties, and a warning not to sign
the contract if there are any blank spaces. It must also be noted on
the contract that it is the responsibility of the contractor to obtain
all the building permits, and that if a homeowner obtains them, the
homeowner will be excluded from applying for compensation through the
Guaranty
Fund if a dispute arises. A contract must also inform the consumer
that state law requires all applicable contractors and subcontractors
be registered with the Director
of Home Improvement Contractor Registration.
Look over your contracts carefully before signing. Any
contract which is presented to you without meeting there requirements
is invalid and could affect your protection under the law. If you are
unsure of anything in the contract, contact an attorney to review the
document. If everything is in order, sign the contract and make sure
you receive a fully executed copy of the contract before the work begins.
Fricot Building & Remodeling Inc. has all of these important provisions
in their contract.
For more information on contract specifications and
to receive a copy of the pamphlet entitled, A Sample Home Improvement
Contract, contact the EOCA
Consumer Hotline.
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Obtaining Building Permits
If you obtain necessary building permits on your own
because you plan to self-contract your home improvements or because
you think you are doing the contractor a favor, you should know that
doing so will reduce your options under the law, should a dispute arise.
It could also extend your personal liability for any work related accidents
or problems. When you hire your contractor, make sure that they obtain
all of the needed building permits. Fricot Building & Remodeling
Inc. always takes care of obtaining all the needed building permits
for your job.
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What Consumers Should Know
about Their Contractor’s Insurance Coverage
Uninsured contractors can expose unwary homeowners to
financial hardship. All responsible contractors should carry appropriate
insurance to protect their clients, their employees, and themselves.
But what insurance should your contractor carry to protect you, the
homeowner?
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Liability Insurance
Your contractor should carry Workers
Compensation Insurance and Liability Insurance. To protect yourself,
you should insist that your contractor and subcontractors carry Liability
Insurance. This insurance coverage protects you if your property is
damaged, or if the contractor, or subcontractors is/are accidentally
injured during the course of the work. Proof of your contractors Liability
Insurance helps you substantiate that this contractor operates as
an independent business, and is not your employee. Therefore, you
are not responsible for injuries, pain, suffering, or lost wages,
provided the injuries were not caused by you.
Get a copy of your contractors Liability Insurance.
Make sure that the policy’s effective dates are current and
that the policy dollar coverage is sufficient to cover any potential
claims for injuries or damages. Be sure the Insurance Certificate
covers the period the workers will be on the job. It is reasonable
to expect that Professional Contractors, such as Fricot Building &
Remodeling Inc., who carry all of the appropriate insurances will
have greater business overhead expenses and that their bid will be
a bit higher than those of an irresponsible contractor, who take business
shortcuts, so they can make a bigger profit at your expense. However,
it is a small price to pay to hire the right contractor for the job,
and forego the risk of exposing yourself, your financial future, and
your home to a contractor who is improperly insured or uninsured.
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Workman’s Compensation
Insurance
Workman’s
Compensation Insurance pays the medical bills and lost wages to
any employees of a company who are injured while working on your house.
Only corporations or employees of companies are covered by Workers
Compensation Insurance. If your contractor’s business is incorporated,
then everyone in that corporation must be insured by Worker’s
Compensation Insurance. If a contractor should, but does not have
Workers compensation Insurance for his or hers employees, the law
exposes you, the homeowner, to litigation by the injured party. Homeowners
increase their risk of exposure if:
- the homeowner takes out the building permit for
the work to be done,
- the homeowner pays the contractor by the hour,
- the homeowner supplies or loans the tools and materials
to get the job done,
- or the homeowner gives directions on how to perform
the job.
If any of the above conditions apply, the homeowner
may, in the event of a lawsuit, be found to be acting as their own
general contractor and could be responsible for anything that happens
to the subcontractors or their employees during the course of their
work.
If your contractor tells you that, he or she has
Workers Compensation Insurance, ask to see a copy of the certificate
and verify that is current.
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Service and Warranties
Make a special effort to learn what type of customer
service and warranty protection your contractor offers. Do not wait
until after you have purchased your home or remodeling project to find
out how to correct a problem, if one should develop. A professional
Builder, such as Fricot Building & Remodeling Inc., will have some
form of a written warranty. Find out the
length of the warranty, and if it is backed by Insurance Company, and
what procedures to follow if a problem arises, if it is backed by an
Insurance Company. Most contractors back their own warranties on workmanship
and materials, typically for a period of one year. A warranty backed
by an Insurance Company costs more, but offers long-range protection.
When choosing a contractor, be thorough and ask a lot of questions.
Get as many specifics as possible. Never hesitate to ask a question
for fear of sounding stupid, or uninformed. What seems like a stupid
question may yield an informative answer, or avoid any future misunderstandings.
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Resolving Disputes
If you have a contract dispute with your contractor
or you think that the job he or she did was shoddy, or done in an unprofessional
manner, there are options for you to explore if the problem cannot be
resolved privately. If the contractor is a member of the National
Association of Home Builders, the consumer can contact the association
to attempt to an informal resolution of the problem. A good first step
would be to contact the Attorney
General’s local consumer group in your area for help with
informal mediation. Beyond that, you are encouraged to fully investigate
the following alternatives. The cost and effectiveness depend largely
on your particular situation.
Homeowners should be forewarned that once a dispute enters this stage,
it can consume a lot of time, effort and energy for both parties before
it is resolved and/or compensation is awarded.
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Arbitration
If a consumer has a dispute against a registered contractor,
or subcontractor, the consumer may try to resolve the dispute through
a state-approved arbitration
program. The consumer selects an approval form and pays a fee, based
on a sliding scale linked to the size of the claim. The fee may include
a non refundable processing charge that would be kept in the event the
case is withdrawn before making it to a hearing. Once the arbitration
firm has been chosen and the application fee has been paid, the case
is heard with both parties present and a decision is rendered. An arbitrator’s
decision is final, but may be appealed by either party in a court within
21 days of the decision.
*For more in formation and to receive a listing of
all approved arbitration firms and a description of the sliding fee
scale, call the Executive
Office of Consumer Affairs (EOCA) Consumer Hotline at: Phone (617)
727-7780 E-mail: consumer@state.ma.us
or fill out the on-line form for the quickest response.
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Court Action
A consumer always has the option of bypassing the arbitration
process by taking the dispute directly to court. Except for arbitration
by mutual agreement of the parties, a contractor is limited to using
the court to resolve any dispute against a homeowner. Either party may
bring dispute to Small
Claims Court if the monetary claim is less then $1,500.00.
A judgment received from either a court action or an
arbitration session fully preserves the rights of the parties to pursue
the other remedies, including additional legal action and, in the event
of a consumer involved in a remodeling dispute, compensation from the
Guaranty Fund (See below)
*For more information about taking a case to Small
Claims Court, call the EOCA
Consumer Hotline and ask for the “Consumer’s Guide to Small
Claim Court”. For help with preparing a court case, which will
result in claims in excess of $1,500.00, and for legal advice, you are
urged to contact an attorney for advice.
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The Guaranty Fund- A Note for
the Remodeling Consumer
If a judgment has been awarded to the consumer,
and the contractor refuses to pay the award, or defaults, due to bankruptcy
or flight, remedies are still available through the Guaranty Fund if
the consumer has used a Registered Home Improvement Contractor.
The fund was created as a source of last resort
to reimburse consumers who have been awarded judgments that have not
been paid. Money in the fund comes from a one-time assessment levied
on Registered Contractors based on the number of employees, which are
on the contractor’s payroll.
When a claim is paid out to a consumer because a judgment
was not paid, the responsible Registered Contractor is obliged to reimburse
the fund with interest within 30 days. If a contractor fails to do so,
he or she may face administrative fines, revocation of his or her registration,
and in most extreme cases, criminal prosecution. To apply to the fund,
a consumer must file the claim within six months of the initial judgment
made by an arbitrator or court, and demonstrate that all reasonable
efforts to collect the judgment award have been exhausted. In most cases,
this will mean that the last step prior to applying to the fund will
have to be a court proceeding, regardless of the option used to secure
the initial judgment.
Claims of up to $10,000.00 in actual losses may be
recovered through the Guaranty Fund. However, if a single contractor
is responsible for more than $75,000 in claims to the fund within a
12-month period, no further claims may be awarded until either the contractor
reimburses the fund, or a new 12-month period begins. If actual losses
exceed what is paid out through the fund, the consumer may seek other
remedies to recover those additional costs.
To find out the standings of s specific contractor,
call the Director of Home Improvement Contractor Registration at (617)
727-8598. For more information about the Guaranty Fund, reimbursement,
or an application, call the EOCA Consumer Hotline at (617) 727-7780.
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