How to Vet a Home Remodeling Contractor Before Signing a Contract

A remodeling project can fail long before the first wall comes down, usually because the homeowner skipped basic checks on the contractor. Before you sign anything or hand over a deposit, there are specific documents, records, and conversations that separate a reliable contractor from one who will cost you money and time. Here is what to check, in order.

Confirm the License and Insurance Are Current

Ask for the contractor’s license number and verify it directly with your state’s licensing board website, not through a copy they hand you. Licenses can lapse, get suspended, or belong to a business entity that no longer operates. Most state boards let you search by name or license number in under a minute and will show any complaints or disciplinary actions on file.

Insurance matters just as much. Request a certificate of insurance showing general liability coverage (a minimum of $1 million is standard for residential work) and workers’ compensation if they have employees. Call the insurance provider listed on the certificate to confirm the policy is active. Without this, if a worker gets hurt on your property or a pipe bursts during demolition, you could be held financially responsible.

Check References and Actual Completed Work

Ask for at least three references from projects completed in the last 12 to 18 months, and ask specifically for jobs similar in scope to yours. A contractor who mostly does small bathroom updates may not be the right fit for a kitchen addition with structural changes.

When you call references, ask direct questions:

Did the project finish within 10-15% of the original timeline?
Were there unexpected costs, and how were they communicated?
Did the crew show up on the days they said they would?
Would you hire this contractor again for a different project?

If possible, visit a completed project in person. Photos can hide uneven tile lines, gaps in trim work, or paint overspray. Seeing the work firsthand tells you more about attention to detail than any portfolio photo.

Get Three Written Bids and Compare Line by Line

Collect at least three bids for the same scope of work. If one bid comes in 30% or more below the others, that’s a signal to ask why, not a reason to celebrate. Low bids often mean corners will be cut on materials, permits will be skipped, or the price will climb once work begins through change orders.

Each bid should break down labor, materials, permit fees, and a contingency allowance separately. A one-page estimate with a single total number gives you no way to compare value or catch overcharges later. Ask each contractor to specify the brand and model of major materials and fixtures, since “mid-grade cabinets” can mean very different price points depending on the supplier.

Read the Contract for These Specific Clauses

Never start work on a verbal agreement or a handshake, regardless of how the contractor comes recommended. The written contract should include:

A detailed scope of work describing every task, material, and finish
A start date and estimated completion date, with language about delays
A payment schedule tied to project milestones, not just calendar dates
A change order process requiring written approval and pricing before extra work begins
Warranty terms for both labor and materials, including duration
Cleanup and debris removal responsibilities

Pay close attention to the payment schedule. A common and reasonable structure is 10% at signing, with the remaining balance split across three or four milestone payments, and a final payment of 10-15% held until you’ve inspected the finished work. Be cautious of any contractor asking for more than a third of the total cost upfront, since large deposits are a common tactic among contractors who struggle with cash flow or don’t intend to finish the job.

Ask Who Pulls Permits and Who Manages Subcontractors

Permits protect you legally and financially. If work is done without the required permits, you may have trouble selling the house later, and insurance claims related to unpermitted work can be denied. Ask the contractor directly whether they will pull permits under their license, and get this in writing in the contract rather than assuming it’s included.

Find out how much of the work will be done by the contractor’s own crew versus subcontractors. This isn’t a red flag by itself, most contractors subcontract electrical and plumbing work, but you want to know who is actually on your property each day and whether those subcontractors carry their own insurance. Ask for the names of the subcontractors they plan to use for major trades, and verify their licenses separately if the work is significant, such as rewiring a panel or moving gas lines.

Watch How They Communicate During the Bidding Process

Pay attention to response times and clarity before you sign anything. A contractor who takes four days to answer a simple question about tile options during bidding is unlikely to become more responsive once they have your deposit and the project is underway. Ask how they prefer to communicate during the project (text, email, phone calls) and how often you should expect updates. Weekly check-ins, even brief ones, prevent small issues from turning into disputes over scope or cost.

Once you’ve confirmed licensing, checked references in person or by phone, compared at least three detailed bids, reviewed the contract clause by clause, and clarified who handles permits, schedule a final walkthrough meeting with your top choice before signing. Bring a list of every question that came up during this process and get the answers in writing as an addendum to the contract if needed.