Tips & Tricks

Peace of Mind – Avoid Cash Contractors

bonded contractor

When homeowners are planning on renovating or fixing their houses, they need to hire the right person for the job to give them peace of mind during the project. Some homeowners believe that paying a contractor all-cash upfront is the best way to go. However, doing this can lead to numerous issues and is not the correct way to pay a qualified contractor. A homeowner should always make an agreement with a contractor through a contract for their renovations. There are many reasons why hiring a licensed or bonded contractor is more advisable as compared to hiring one who isn’t.

Reasons Why People Should Avoid Cash Contractors

  • The Proper Research Matters

Before hiring a contractor, it is crucial that homeowners do thorough research on how and where they can find the right contractor to do their job prior to signing any contract. Homeowners are at a disadvantage because they have untrained eyes to find errors in technical work. Also, homeowners aren’t aware of the fact if the work of their contractor’s work is up to code. Therefore, it is also advised to get the renovation project assessed by an inspector before it is completed.  

  • The Homeowner Probably Has to Pay for A Renovation Job That Didn’t Work Out

If an individual does not hire a licensed or bonded contractor and end up paying them in cash upfront instead of signing a contract, then there are chances that they could find some potential errors in their house post-renovation. This could lead to further problems where one would have to hire another contractor in order to get the issues fixed that were made by a previous contractor. Renovations cost a lot of money in itself; therefore, instead of hiring a contractor who demands cash right away might not be the right way to go. Hence, it is best to avoid that trouble and hire a contractor who is willing to sign an agreement prior to starting work on an individual’s house. 

  • Unfinished or Low-Quality Work

What can you do if a project is left unfinished or not done right and you already paid your contractor? If the homeowner does not have any receipts or a written contract for their cash payment, then there isn’t any proof. Having a written contract with a licensed and bonded contractor, who might have made errors during the renovation process, will surely make the whole issue much easier to solve. Not to mention it will be less expensive as well. Having a contract lowers the chances of any misunderstanding that might occur and places the homeowner in a better position when it comes to demanding for satisfactory work.

  • Workers That Get Injured

The majority of the contractors are supposed to have insurance, also known as Workers’ Compensation coverage, in order to protect the workers who might get injured during a renovation project. Hence, if a homeowner hires a contractor by paying in cash, who doesn’t have a Workers’ Compensation, then they will be responsible for providing medical or rehabilitation costs in case a worker gets injured on their property. Therefore, hiring a person who isn’t insured properly could potentially place a homeowner in financial and legal risk. A professional and bonded contractor will show the homeowner proof of their Workers’ Compensation coverage before moving on with the renovation project.

  • No Warranty

When a homeowner plans on renovating their place, they are making a significant amount of investment in that project; hence, they would want a warranty for the work that is going to be done to their house. Providing the homeowner with a warranty is part of the written contract of the contractor. Having that warranty means that in case something does go wrong, the homeowner can rely on their contractor to come back and fix it. However, not having a written contract with the contractor does not provide the homeowner any guarantee that their contractor will return in case the renovation is not done right. Furthermore, the contract should include all of the relevant information, such as a detailed explanation of all the work, the materials that will be used, the cost the homeowner is paying, the duties of both the contractor and the homeowner, and any other details that are specific for that project.

Why Is It Important To Hire A Licensed And Bonded Contractor?

Hiring a licensed and bonded contractor will ensure that the homeowner is safe from any fraudulent activity. A contractor who is licensed will already have the Workers’ Compensation coverage; hence, the homeowner does not have to worry about any additional cost in case of worker injury. Furthermore, being bonded differs as compared to being licensed, even though both are almost similar. A bonded contractor will have a surety bond, which is a version of an insurance policy that keeps a property owner protected. For instance, if a contractor does not finish the job as needed, then the bond provides compensation to the homeowner.

Furthermore, an unlicensed contractor is not liable when it comes to fixing any post-renovation work that might not be according to the homeowners’ liking. Plus, it is not guaranteed that they would return in order to fix any issues that might have taken place. With a licensed and bonded contractor, a house owner is pretty much guaranteed to resolve any issues post-renovation.


In the end, it is vital to find out every little detail you can about your contractor when you find the right one. Cost shouldn’t be the sole important aspect of the whole situation. A person’s home is where they will be spending most of their time; therefore, how their home is renovated matters greatly. No one wants low-quality construction in their house. Give yourself peace of mind and make sure you take the right steps before hiring a contractor.

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