Contractor
pre-qualifcation

​Learn about the different questions you should ask your contractor before you hire them to work on your rehab project.

Contractor pre-Qualification

How to Flip Houses / Contractor Pre-Qualification

Overview

Before your hire a Contractor to work on your rehab project you should ask the Contractor these critical questions to determine if they are qualified to work on your rehab project.

What are the Contractor's Qualifications?

How long has the contractor been in business or in the construction industry?

​​This one is misleading because the company could be new, but the contractor could have 10 years of experience, so be sure to find out how much construction experience the contractor has in the industry.

What is the Contractor's average sized project?

​It's important to find out the scale & scope of work for the Contractor's typical project.  Does the contractor typically only work on small bathroom remodels or are they qualified to manage a full rehab project?

What trades does the Contractor typically self-perform?  What trades does the Contractor typically subcontract?

Will the Contractor be self-performing the work or hiring other contractors to perform the work?  It's important to understand who will be performing the work on your project and making sure that the subcontractors your contractor are utilizing are qualified, licensed & insured as well.

Does the Contractor have a Portfolio or References?

Project Portfolio

Ask your Contractor if they can provide a portfolio of past projects that highlights the Contractor's quality and craftsmanship.  Your Contractor should be able to provide marketing materials or a link to their website where you can see photos of their completed projects.

Reviews

Check for reviews online for your Contractor to see what other past clients are saying about the Contractor:
  • Google Reviews
  • Facebook Reviews
  • Thumbtack/Houzz/Angies List
  • Better Business Bureau

Reviews

Although your Contractor may have an impressive portfolio, it's important to also ask your contractor for a list of at least 3 references that you can call and ask for feedback.  Ask your Contractor for references from past clients, other real estate investors, agents, inspectors or subcontractors.

Ask the references about their experience working with the Contractor:
  1. How was the working relationship?
  2. Did the Contractor show up to the site everyday?  
  3. Did the Contractor complete the work on-schedule?
  4. Did the Contractor maintain a clean & safe jobsite?
  5. Were there any unreasonable change orders?
  6. Were there any disagreements?

Is the Contractor Licensed and Insured?

Contractor Licensing

For certain trades and scopes of work (generally Structural, Plumbing, HVAC, Electrical) you will need to hire a Licensed Contractor to perform the work.  In some areas, your General Contractor and Subcontractors will need to be licensed in order to pull permits for the project.  Check your local building department to determine which Contractors need to be licensed on your projects.

Contractor Insurance

Always make sure your General Contractor or Subcontractors working on your project have their own General Contractor Liability insurance.  The insurance should cover:
  1. Bodily injury to you, your family or visitor's of the property.
  2. Any accidental damage to your property.
  3. Workman's compensation for injuries to the contractor's or subcontractors employees.​
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PRO TIP
Ask your Contractors to provide a 'Certificate of Insurance' which will provide proof that the contractor is currently insured and provide information on the type of insurance coverage and the insurance limits. This is a standard document & request that contractor's are asked, so if you get push back that should be a red flag!

What's the Contractor's availability?

What other jobs is the Contractor currently working on that could affect your project?

​Ask your Contractor what other projects they currently have going or planned during your project to understand how your project will be prioritized.

How many employees does the Contractor have?  Do they have enough manpower to staff your project?

If your Contractor does have multiple projects going at once, find out how many employees they have and ask if they have enough manpower to staff your project.  You should generally have at least 1 or 2 workers on-site everyday in order to keep your projects on-schedule.  (No lost days!)

When can the Contractor start construction and how long will Construction take?

Find out when the Contractor can start the project and discuss the time frame the contractor estimates it will take to complete the project.

How does the Contractor handle unforeseen issues or change orders?

When rehabbing houses, unforeseen issues are going to inevitably happen on your projects, which can often arise in arguments, conflicts and change orders.  The way that you and your Contractor manage these issues are essential to maintaining a strong working relationship, staying on-track and on-budget.
  1. What is the Change Order process?
  2. How are Change Orders communicated and agreed upon?
  3. How are Change Orders priced?  
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Reality check
You and your contractor should agree upon a Change Order process upfront, so when an unforeseen issue inevitably arises, you will both be on the same page.
  1. Does the Contractor have any legal judgements, lawsuits, or arbitration proceedings pending or in the past?
  2. Has the Contractor filed a Lien on a property?
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Reality check
Your Contractor's legal history can be good indication of bad business practices or trouble with past clients. With that said, disagreements arise in construction so it's important to give the Contractor a chance to explain their situation.

Ultimately, you want to work with reasonable Contractor's that can manage conflict reasonably without involving lawyers or putting liens on your property!

Does the Contractor Carry a Warranty for the Work?

Ask your contractors if they provide a warranty on their work workmanship?  

Generally, it's reasonable to expect tradesman to warranty their work for 1 year after project completion.

Download our Sample pre-qualification form

download your free contractor pre-qual form

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