Low Bids vs High Bids
I am on my soap box about hiring licensed vs. unlicensed contractors today and I am proud to say that YCCA is an advocate for consumer protection and our allegiance is to the community, to ensure that you are able to connect to contractors, tradesman, suppliers and professionals locally. We are proud to be your local resource. There are laws in place that govern residential construction and labor and these laws exist to protect homeowners and licensed contractors are held accountable for the work they do, whereas unlicensed and handyman are not held accountable through the State of Arizona. Licensed contractors are required by law, to follow guidelines established by the Registrar of Contractors when performing work. Licensed contractors are required to hold worker’s compensation insurance for those who work under them and are required to hold liability insurance.
Unlicensed labor has an unfair advantage over those who work within the law. People not licensed and who act as contractors normally do not pay worker’s compensation for the people who work for them, they do not pay licensing fees and regulatory fees and often do not meet their obligations to collect payroll taxes for those who work under them.
Yes, you as the homeowner have the right to hire someone without a license. We can only say beware! Daily, I receive calls from citizens in our community that have been scammed, have had shoddy work performed and have lost hundreds and even thousands of dollars. I will say again that licensing is not necessarily a measure of competence, skill, proficiency and ability, however hiring an unlicensed contractor is certainly a hazard and hiring a licensed contractor does imply that there is a level of experience, competence and that the licensed contractor is committed to his profession, as being licensed does involve financial obligations to maintain a license and the appropriate insurance and bonding requirements.
Licensed contractors are playing by the rules, paying taxes, paying insurance and daily they are being underbid by unlicensed contractors from 20-35% on projects. These savings come with risks! There has been a huge increase in complaints through the Registrar of Contractors pertaining to unlicensed issues.
Most building projects even minor ones usually require building permits and inspections. Many times unlicensed contractors “borrow” someone else’s license number. If your project is not permitted or does not comply with building code, you will probably be ordered to either remove the structure or bring it up to code. Just this week, an unlicensed contractor poured a foundation for a garage, did not obtain a permit, the neighbor discovered the concrete foundation was encroaching into his property and called the building department. The “contractor” skated, left with $5,000 and now the homeowner has to go to the expense of removing the illegally poured concrete pad. Had this homeowner checked this “contractor” out before starting work and followed some simple steps, they would not have lost several thousand dollars.
Interview and hire only licensed contractors. Check a contractor’s license status by calling YCCA, we proudly stand behind our members. Many internet referral sources and marketing companies do not verify license status, they leave it up to the consumer to verify the legitimate issues before hiring or doing business with the contractor. Just because a contractor is listed on these internet referral sites does not mean their license is in good standing. YCCA walks you through this verification and we will assist you. You can trust our reviews. All contractor advertisements, whether it be an ad in the phone book, or newspaper, a flyer, or the name on the side of a truck, MUST HAVE the contractor’s state license number. Contractors are also required to have their license number of their business card and on all bids and contractors. However, just seeing the number does not mean the license is valid.
Remember, although an unlicensed contractor may give you a low bid, the risks of possible financial and legal consequences you may face far outweigh any benefits a lower bid may seem to offer.
Remember, you can do more to protect yourself before hiring a contractor than the Registrar of Contractors can do to help after you have been harmed.
Remember most licensed contractors are competent, honest, hardworking and financially responsible. Most of the problems YCCA sees could be prevented if homeowners knew their home improvement rights and took responsibility for their project. A responsible and informed consumer can work more effectively with reputable contractors and can avoid being victimized by unscrupulous or unlicensed contractors.
The State of Arizona, through the Registrar of Contractors promotes quality construction through a licensing and regulatory system designed to protect the health, safety and welfare of the public. It is important to protect yourself by avoiding unlicensed contractors and YCCA is committed to protecting our citizens against unlicensed contractor activities and scams.
Problems may occur during construction; this happens with licensed contractors as well and the average experience in dealing with an unlicensed contractor can be devastating. Most of the consumers that call me for help complain that the unlicensed contractor did shoddy work and others call to report that the contactor ran off with their money, or started the job and never finished. As we have shared with our readers on many occasions, it is essential and vitally important to verify the credentials of any contractor you are considering to hire. You can easily do this by calling YCCA and we are happy to confirm if the contractor is licensed and in good standing, the license issuance date, expiration date and complaint history on their record for the last 5 years. We can also confirm if the license has been suspended for any reason during the time period of the license being active.