Unlicensed contractors: Your Bottom Line

Get our FREE ebook, "How to Budget for an IKEA Kitchen Remodel"

...and visit our website to find out about expert IKEA Kitchen Design Services

As is true with any licensed contractor, our company has an obligation to report unlicensed activity. Beyond that, we feel we have an obligation to educate our clients and community in regard to this matter. Unlicensed contracting means any person who is not licensed and yet who does remodeling or repair work, residential or commercial, for over $500. Typically, there is no written agreement or contract for this work, another illegal aspect. A written contract for home remodeling and repair is required by state law. It is also vital for the protection of the homeowner's rights.

Many homeowners simply choose someone based on low prices. This is understandable but let's look at the consequences of hiring an unlicensed person or company to work on your home. And then let's look at why their prices may be low.

First, a homeowner who hires an unlicensed contractor (this can be a handyman or someone to install flooring or lighting, or just someone to do some repairs around the house, etc.) has no recourse should something go wrong.

Let's say you hire a guy your neighbor recommended to install your new cabinets and countertop, and a dishwasher. He's not licensed, just a part-time handyman. The guy does a decent job although one drawer doesn't pull out in the right way and the countertop edge is a little crooked. You call him to come fix these issues and he doesn't return your call. There is really nothing you can do but you figure you've save money so you live with the problems.

But what if, three days later, there is water on the floor, a leak from under your sink. You now have to call a plumber. The plumber finds the water leaked into the subfloor and it now needs to be replaced or you're going to have a mold problem. You have no recourse. You do not have a warrantee on the handyman's work, you have no written contract. You also cannot discuss this with your plumber who, if he's licensed, has an obligation to report the handyman (though he may not).

You see the picture. Was it worth saving a few hundred dollars to hire an unlicensed guy?

Now let's look at why this guy charges less. First, if he's unlicensed, he's not paying for insurance (you have to be licensed to get either insurance or a bond) and is unlikely to be reporting all his handyman income. He's not going to have a city business license either, so no fees or taxes he has to pay locally. If he has "employees" or helpers, he's not paying for Worker's Compensation Insurance, a big expense for a licensed contractor. In California, he may not be a citizen, and thus may pay no taxes at all.

Of course this guy is cheaper. Is it worth it? If you pay taxes out of your income, perhaps you want others to do the same. Perhaps you want the people who are working in your home to be covered by Worker's Comp (required by law) for their own safety and protection. What would happen if a guy working in your home got injured on the job and he is not licensed or covered by WC?

My point is not to scare anyone or to make up frightening possible scenarios. My point is that hiring an unlicensed person to do repair or remodeling on your home is not worth it. Support the guy, the company, that made the effort to study, learn his trade and trade business practices, and passed his licensing exams and keeps up with license requirements, who pays taxes, who covers his employees with insurance. When you hire an unlicensed guy or company instead, because it's cheaper, you are penalizing the licensed, tax-paying guy. He's got to compete with these lower prices while having to pay taxes and insurance the other guy doesn't pay.

That's the picture, the view from a licensed contractor's office. Thank you for letting me speak out.

101 Reasons NOT to Remodel Your Home

Get our FREE ebook, "How to Budget for an IKEA Kitchen Remodel"

...and visit our website to find out about expert IKEA Kitchen Design Services

101 Reasons Not to Remodel Your Home
Remodeling Humor for the Lighthearted

1. It is less stressful and much cheaper not to.
2. Your kitchen was good enough in 1954, why mess with it?
3. The mill has stopped making the wood flooring you bought too little of last year and the boxes of it in your garage have mildewed anyway.
4. Walls are not meant to be taken down.
5. There are 26 layers of paint-wallpaper-paint that, if scraped off, would widen your bathroom by a foot and a half and disorient you at 3am.
5. You can simply decide that your almond appliances are just a pastel shade of stainless steel.
6. The eight foot high cement block wall you have wanted to build around your property will not increase its value.
7. Your neighbors will call the City on you, no matter what you do.
8. Adding kitchen and bath outlets will encourage the acquisition of embarrassing small appliances like sandwich fryers, dog vacuums, and portable electric bidets.
9. For any project large or small, you will have a boat-sized, rusted blue dumpster in your driveway for months, if not years.
10. Since they don’t get shipped, ever, you will come to believe that railings are highly over-rated.
11. Your contractor is waiting for a vacation until he starts your project.
12. Living without windows and doors for awhile.
13. If you simply throw away half your stuff, you’ll have twice as much room without further inconvenience.
14. There isn’t really any known way to make room for a pool table, or for a pool, where either do not naturally exist.
15. A Sunday morning outing to Café De Omelet vs. three to Home Depot.
16. You cannot really improve on a toilet enough to make it worth $3000.
17. Turrets are better left in the Middle Ages.
18. You will have to make hundreds of decisions, none of which really matters.
19. Everything to do with remodeling, every single possible item, is toxic.
20. The fumes will kill you, or with luck they will only destroy the creativity that got you started.
21. ……..? umm………….
In life, as in literature, you will run out. You will run out of flooring, you will run out of tile, you will run out of pvc pipe the size you need, you will run out of bricks, paint, drywall, washers, trim, rags, wire, shingles, shims, flashing, fencing, and sconce brackets and there will not be just one more squeeze of silicone nor one more rung on your ladder to lift you to the code-required heights a better, more expensive ladder might have.
So you will have to run out to get another, to get more. Sadly, but predictably, no matter what it is you need, the hardware store has also run out.
To avoid this running out—of material, enthusiasm, life-force, money and the will to awaken to the odor of sweating men to whom you are not related—please re-read from #1. In remodeling, everything has to be done twice.