How To Tell if a Contractor is Overcharging for Materials

Whether you are getting a new house built or an old home renovated, often you rely on a contractor to do most of the hard work as you watch their progress. But it is very important that you, as a customer, must keep an eye on how they do business with you.

The following guide will help you determine if your contractor is overcharging, especially in construction materials.

  • Homework. Before you begin on a major project, especially on your very first house renovation, the best way to do is to check out every contractor in your locality, especially their track record, reputation and credibility, expertise and experience. Try to inquire with the Better Business Bureau if possible. Ask someone who have hired a contractor in the past, and they will recommend one or two contractors that they feel are credible and trustworthy, and who can provide a true estimate of costs; such good contractors are less likely to overcharge, and less likely to use substandard materials, questionable suppliers and barely-competent labor.
  • While in progress. Sure, the contractor may be a great recommend from a friend, with their submitted projected costs, and after signing a joint and detailed contract, you hire them to work on your home, but what happens once they get down to work?

    As you are their customer, it is imperative that you must act as the overall supervisor on the worksite, as you always keep an eye on all construction activities (and use a camera and a journal to track the progress of your project day after day), from the way a carpenter nails the baseboard in place, how the tiles are placed on the bathroom floor, or how well the roofing shingles are installed; if they tend to overcharge in terms of materials and labor, and you see that they are wasting supplies through shoddy work, you’ll have to drop them and pick another contractor, no matter how much the contractor makes justifications, as long as you have any visible evidence of wrongdoing.

    Apart from the labor and material costs, demand copies of receipts they have obtained in purchasing and acquiring the materials, and compare them with the bill of materials actually used in construction. This is to determine if the contractor is billing you for expensive materials, but is using substandard ones in place.

    If you can keep a closer eye at the worksite, you can try to make a physical count of materials in use and compare them to the material list, which should tally; any discrepancy from the actual requirements is a sure sign that some of the material bulk is hidden from view.

  • By the end. Finally, if you are about to pay them, first ask the contractor about a breakdown of their labor and material costs in full detail, listing what materials they have bought, how much they spent on, and how much they would be charging you.

Factor in the cost of the contractor’s materials handling, that is, how much percentage they charge for selecting, ordering and delivery of materials to the worksite.


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