What is a red flag when hiring a contractor?

When hiring a contractor, requesting a payment of more than one-third upfront before work commences can be a significant red flag. This practice can indicate that the contractor might not have the financial stability or reputation necessary to complete the job satisfactorily. Standard industry practices typically involve requesting a smaller percentage upfront (often 10-20%) to secure the services, with additional payments tied to specific milestones or the completion of work. Excessive upfront payments can put the homeowner at risk, potentially leading to situations where the contractor may take the money and not deliver on the promised work or quality.

In contrast, a contractor who asks for a lower percentage for deposit, offers various payment methods, or provides multiple confirmed referrals tends to demonstrate transparency and reliability. These factors generally indicate that the contractor is established and has a good track record in their work, which helps build trust. Therefore, understanding the norms regarding payment structures in the industry is crucial for making informed decisions when hiring.