What the FTC says to do before hiring
This section draws on the FTC's current page, "How To Avoid a Home Improvement Scam" (July 2022), and its older, more detailed "Hiring a Contractor" brochure (March 2014). Points found only in the brochure are labeled.
Research first. Ask friends, neighbors or co-workers who have had similar work done, and look at that work if you can. Check ratings on sites you trust, and search the company's name next to words such as "scam" or "complaint."
Get several written estimates. The 2014 brochure says to collect written estimates from several firms, and the current page says not to automatically choose the lowest bidder and to ask why estimates differ. A very low bid may omit scope others priced in; that is my reading, not the FTC's.
Put the deal in writing. The current page says, "Even if your state doesn’t require a written agreement, ask for one." The 2014 brochure lists what it should cover: the contractor's name, address, phone and license number (if required), estimated start and completion dates, the payment schedule, who pulls the permits, how change orders are handled, a detailed materials list, warranty terms, and anything promised verbally.
Handle the money carefully. The current page says, "Don’t pay the full amount for the project up front," notes that some states limit the size of a down payment, and says never to make the final payment until the work is done and you are satisfied. The 2014 brochure adds three points: do not pay cash, make payments contingent on completed amounts of work so that a late job delays payment, and hold the final payment until subcontractors and suppliers are paid, because in some states they can file a mechanic's lien against the home. It advises asking the contractor, and each subcontractor and supplier, for a lien release or waiver.
How to check a license
The current FTC page advises considering only contractors who are licensed and insured, and verifying the license with your state or county. The 2014 brochure adds that many states, but not all, require licensing, which "can range from simple registration to a detailed qualification process." Start with your state licensing board or local building department.
Two examples of what that looks like in practice:
- California. The Contractors State License Board (CSLB) says contractors hired for work costing $1,000 or more in labor and materials combined must be licensed, and any project needing a permit or workers requires a licensed contractor. Its license-check tool searches by license number, business name or personnel name and supports checking complaint disclosure. CSLB's checklist also says to confirm a contractor has workers' compensation insurance if they have employees, and to pay no more than 10% down or $1,000, whichever is less, with an exception for contractors who have a blanket performance and payment bond on file.
- Florida. The state's Department of Business and Professional Regulation runs a "Verify a Licensee" search that looks up individuals or organizations by name, license number, city or county, or license type. I did not verify Florida's specific licensing thresholds, so check the category your project falls under.
Confirm the license is current and that the name on it matches the business on your contract.
"Don’t automatically choose the lowest bidder."
Why proof of insurance matters
The current FTC page says to ask the contractor to show proof of insurance. The 2014 brochure is more specific: contractors should have personal liability, workers' compensation and property damage coverage, and homeowners should ask for copies of the insurance certificates and make sure they are current, "or you could be held liable for any injuries and damages that occur during the project." If subcontractors will be on site, it says to confirm their insurance and licenses too.
California's CSLB puts the risk in similar terms: it says few, if any, unlicensed individuals have a bond or workers' compensation insurance, and says unlicensed work puts a homeowner's financial security at risk if a worker is injured on the property. My own suggestion, not the FTC's: have the insurer send the certificate to you directly.
Where to collect comparable quotes
Quotes are only comparable if they describe the same job. Give every contractor the same written scope, then compare line items, not just totals.
Ways to build the list:
- Referrals. The 2014 FTC brochure's first suggestion is friends, neighbors or co-workers who have had similar work done. You can see finished jobs and ask about surprises. The limit is that your circle may only know one or two names.
- Your local building department or consumer agency. Both can tell you what licensing and permits apply where you live.
- Online marketplaces and project-posting platforms. These can widen the field beyond your own network. Angi and Thumbtack are well-known examples; I have not evaluated their terms or fees for this article, so read each platform's own rules before posting.
Tools that can help: YOTU Pro is another such platform. Disclosure: Oppositioner and YOTU Pro are owned by the same company, NexusVibe S.L. On YOTU Pro's client page, the company says posting a project, receiving quotes and comparing professionals is free for clients, that professionals pay a small fee to contact clients, which does not change their quoted price, and that there are no commissions, that professionals can send proposals with price, timeline and conditions, and that you can decline without obligation. It says professionals go through a manual review of their ID, tax number and public liability insurance. Projects are posted through its project form. The page states plainly that proposals and timing are not guaranteed, so posting a project may not produce any quotes, and you should run the referral route in parallel.
