Phase 4 – Selecting a Contractor


4. Selecting a Contractor

Now that you have gotten your plan approved, it’s time to move on to the next step in reaching your goal of homeownership which is selecting a Contractor.

Finding a good contractor is important because a construction project gone wrong can cost you. Not only pecuniary loss but it can be a threat to your health and safety.


Tips before you select a contractor

  • A good advertisement isn’t proof a contractor does quality work.
  • Find out for yourself about previous work done by a contractor by checking with friends, neighbours, or co-workers who’ve built or had improvement work done.
  • Check out a contractor’s reputation using social media and ask for a police clearance.
  • Get written estimates from several firms or other contractors, keeping in mind the lowest bidder may not be the best choice.

Finding a Contractor

Types of Contractors

Depending on how big or complex a project is, you might hire a:
  • General contractor, who manages all aspects of a project, including hiring and supervising subcontractors and scheduling inspections.
  • Specialty contractor, who installs particular products like cabinets and bathroom fixtures.
  • Architect, who designs homes, additions, and major renovations; especially ones involving structural changes.
  • Designer or Design/Build contractor, who provides both services of building and designing your home.

Guidance to find a contractor

1. Look for signs of a disreputable contractor

  • How can you tell if a contractor might not be reputable? You may not want to do business with someone who:
    • Just happens to have materials left over from a previous job.
    • Pressures you for an immediate decision.
    • Only accepts cash, asks you to pay everything up-front, or suggests you borrow money from a lender the contractor knows.
    • Doesn’t provide you with important or working contact information

2. Do Your Research to gather evidence of previous work

  • Check with friends, neighbours, or co-workers who have used a contractor. If you can, take a look at the work done and ask about their experience.
  • Check the firm’s/ Contractor’s social media pages and website
    Check to see if persons who have hired contractors have similar experiences either good or bad. You also can check out a contractor’s reputation online by searching for the person’s or company’s name to see what kind of reviews they receive.
  • Find out how long they’ve been in business
    Look for an established company or contractor whose record and reputation you can check out.

3. Before You Hire a Contractor, you should acquire various estimates

Once you’ve narrowed your options, get written estimates from several individual contractors or the contractor’s construction firm. Don’t automatically choose the lowest bidder. Ask for an explanation to see if there’s a reason for the difference in price.

Ask these Questions:

  1. How many projects like mine have you completed?
    Ask for a list so you can see how familiar the contractor is with your type of project and if possible, check out the projects yourself.
  2. Will my project require a permit, especially if I’m doing changes to my property?
    In Guyana, you are required to have permits for building projects, even for simple jobs like adding a veranda. A competent contractor will get all the necessary permits before starting work on your project. You may want to choose a contractor familiar with the permitting process in rural or urban areas.
  3. May I have a list of references?
    A contractor should be able to give you the names, addresses, and phone numbers of at least three clients with projects like yours. Ask each client how long ago the project was and whether it was completed on time. Was the client satisfied? Were there any unexpected costs? Did workers show up on time and clean up after finishing the job? You also could tell the contractor that you’d like to visit jobs in progress.
  4. What types of insurance do you carry?
    Contractors are recommended to have the following coverage:

    1. personal liability
    2. worker’s compensation
    3. property damage coverage – Ask for copies of insurance certificates, and make sure they’re current, or you could be held liable for any injuries and damages that occur during the project. N.B. Though this is important, for residential homebuilding in Guyana most small contractors may have to pass on the policy cost to the homebuilder. Sharing the policy expense between the client and the contractor might be a good option here.
  5. Will you be using specialist subcontractors on this project?
    Here you may have specialist sub-contractors e.g.:

    1. HVAC (Heating, ventilation and air condition)
    2. Landscaping
    3. Lift installation
    4. Electrical installationN.B. Usually, you want to keep it simple in a simple Residential home building contract by having only one person to deal with and one contract.

After you hire a Contractor, ALWAYS keep records

Get a Written Contract

Ask for one. It should be clear and concise and include the “who, what, where, when, and cost of your project”. Before you sign a contract, make sure it includes:

  • The contractor’s name, address and phone number.
  • An estimated start and completion date.
  • The payment schedule for the contractor, specialty subcontractors and suppliers.
  • How change orders are handled. A change order is a written authorization to the contractor to make a change or addition to the work described in the original contract and could affect the project’s cost and schedule.
  • A retention fee –. e.g. A Retention fee of 5% to 10% should be deducted from each payment due to the contractor. On practical completion of half or 50% of the project, the retained amount should be released. The client and the Architect or Construction technician/ Engineering technician should do a walk-through with the contractor. Any defects found should be listed and agreed upon with the contractor. The contractor should remedy these defects within a period of time agreed upon by both parties. After the defects have been remedied to the satisfaction of all, the last half of the retention fee should be released.
  • A detailed list of all materials including each product’s colour, model, size, and brand. If some materials will be chosen later, the contract should say who’s responsible for choosing each item and how much money is budgeted for it (this is also known as the “allowance”).
  • Information about warranties covering materials and workmanship, with names and addresses of who is honouring them; the contractor, distributor, or manufacturer. The length of the warranty period and any limitations also should be spelled out.
  • What the contractor will and won’t do. For example, is site clean-up and trash hauling included in the price? Ask for a “broom clause” that makes the contractor responsible for all clean-up work, including spills and stains.
  • Any promises made during conversations or calls. Remember, if they don’t remember, you may be out of luck or charged extra.

Good Idea

Remember, to keep all paperwork related to your project in one place. This includes:

  • Copies of the contract
  • Change orders
  • Any correspondence with your home improvement professionals
  • A record of all payments. You will need receipts for recourse in the event something goes wrong.
  • Keep a log or journal of all phone calls, conversations, and activities. You also might want to take photographs as the job progresses. These records are especially important if you have problems with your project during or after construction.