TOP 5 MISTAKES Homeowners make during the course of construction

1. Paying for work not yet complete or done incorrectly.

Too many times contractors will bill for work not yet completed because they need the money to meet their payroll or child support or whatever. This generally won’t catch up to you until the end of the project when there is no more money left and the job is not yet complete. Chances are you won’t have the expertise to catch this. Make sure that someone walks your job with invoice in hand to verify that all the work is complete that you are paying for. If it isn’t you, find someone with construction knowledge that can tell the difference between plumbing being 50% complete and 20%.

2. Paying the contractor more money when subs/suppliers haven’t been paid from the last payment.

Did you know that a subcontractor or material supplier providing services or materials to your project has the right to lien your home if he is not paid WHETHER YOU HAVE PAID THE GENERAL CONTRACTOR OR NOT! It is YOUR responsibility to ensure that they get paid. There is a simple way to do this – it just takes a little organizational skill and the willingness to track everything. (I’m good at this.) Go to CSLB.ca.gov for information on how to do this yourself and what your rights are. Which leads to my next pet peeve:

3. NOT holding a 10% retention throughout the project

You have a legal right to protect yourself. Holding 10% back from EACH contractor billing ensures that there will be money left in the contract at the end. This is your legal motivation to get a COMPLETE project. All those little, pain in the rear things that are left hanging at the end of the job? 10% of the contract is usually motivation enough to actually see them done!

4. Time and Material contract on a large project

Time and Material contracts in general benefit the contractor. Not the homeowner! Your contractor will tell you otherwise, but I have yet to see one of these contracts come in under budget – or even ON budget. If you MUST have a Time and Material contract, at least put a “Not to Exceed” price in it. Otherwise, you are opening your check book to what the contractor wants to do. If a contractor is put to a budget, they are more likely to use materials wisely instead of wastefully. Inside of a budget, subcontractor mistakes are paid by the subcontractor – not you! Change orders become documented alleviating the “he said – she said” arguments. And you know from the outset what this project is going to cost you.

Ever driven around town and have seen a project sit undone for months and months? I would bet you these are owners that ran out of money because they didn’t have any idea what it was going to cost. Now the money that they DID put in is useless. They can’t live in the house and they can’t get that money back because the work IS done!

5. Hiring a contractor that does not carry both workers’ compensation and liability insurance

Directly from the CSLB website!

a. Ask to see a copy of the certificate of insurance, or ask for the name of the contractor's insurance carrier and agency to verify that the contractor has the insurance.

b. In California, if a contractor has employees, they're required to carry workers' compensation insurance. The importance of this cannot be overstated. If a worker is injured working on your property and the contractor doesn't have insurance, you could be liable to pay for injuries and rehabilitation. Your homeowner's insurance may or may not cover those costs. You should check with your insurance carrier to make sure the workers' compensation insurance coverage being provided by the contractor is adequate. Learn more from the California Department of Insurance.

c. Commercial general liability insurance is not required, however, it covers damage to your property. If the contractor does not carry general liability insurance, they should be able to explain how they would cover losses that would ordinarily be covered by insurance. If your contractor damages your property and doesn't carry commercial general liability insurance, you or your insurance policy could end up paying for damages.

d. A licensed contractor must provide you with information regarding both types of insurance in your written contract.

Welcome, Home Renovators!

Either you are getting ready to embark on a substantial construction project or you were just bored today. In either case, you found me! I am Vicki Hoppin, owner of Hoppin Construction Administrative Services (HCAS for short..). I have over 15 years of experience in the construction industry and have seen all kinds of things. This is one of those times when you would be much better off learning from others’ mistakes and not insisting you gain knowledge from your own experiences.

I started HCAS for the same reasons I believe Mike Holmes from "Holmes on Homes" (HGTV) does what he does….we are heartbroken watching homeowner after homeowner devastated - and unnecessarily so, when there are so many legal protections in place. You don’t have to be one of those nightmares! Protect yourself from the beginning. A large construction project is an emotional adventure that need not also be financially devastating. But beware….managing your project properly can be a full time job!

What I hope to do through this blog is give you input and resources that will enable you to end up with your dream come true with only minimal hair pulling. Most homeowners only do a home renovation project once – you don’t have time to gain the experience that will help you on ‘the next one’. I will provide you with website links that I hope you take the time to check out. I will share my own experiences and insights into how you can avoid some of the most common pitfalls.

Although my services are available to those in the SF Bay Area (California), I am more about helping you avoid financial ruin. Whether you decide to manage your project yourself or hire a professional – don’t let your contractor be your only project watch dog. They have other things that will take precedence over you. I’m not judging – I’m just saying: I have seen contractors with the highest integrity get into trouble – and it is those projects with the least amount of checks and balances in place that will dig them out.

If you do nothing else, check out the information available to you from the California Contractors State Licensing Board. It is easy to understand and extensive. www.cslb.ca.gov

Come back here often. I will continue to provide resources I think will benefit you as well as share experiences of my own. Feel free to leave questions or your own experiences.