Hiring a contractor is one of the most consequential decisions a homeowner makes. The work they do affects the safety, performance, and value of the home. The process they follow determines whether the project stays on budget, on schedule, and on scope. The relationship they maintain determines whether problems — and there are always some — get handled well or become disputes.
Most homeowners approach this decision with less preparation than it deserves. Not because they are careless, but because contractor selection is not something most people do often enough to develop intuition for it. The result is that important questions never get asked, red flags go unnoticed, and the homeowner learns what they should have asked only after the project is underway.
Knowing the right questions to ask before hiring a contractor changes that dynamic. It puts the homeowner in a more informed position from the first conversation, helps distinguish contractors who earn trust from ones who simply project confidence, and creates a foundation for the working relationship that follows.
This guide covers the questions worth asking — across licensing, insurance, process, communication, and financials — regardless of which type of project or contractor you are evaluating.
Licensing and Credentials
Are you licensed to do this work in my state?
Licensing requirements for contractors vary by state and by trade. In Minnesota, Wisconsin, Illinois, and Colorado, general contractors, roofers, electricians, plumbers, and other specialized trades each have their own licensing requirements. A contractor who is licensed in one state is not automatically licensed in another.
Ask for the license number and verify it through your state’s licensing board. Most states maintain searchable online databases that confirm whether a license is current and whether any disciplinary actions have been taken. This takes five minutes and is one of the most reliable pieces of due diligence available to a homeowner.
Do you have the required permits for this project?
Most significant home improvement projects require building permits. Permits exist to ensure that work meets building code standards and that a third party inspects it. A contractor who discourages permit pulls — citing speed, cost savings, or other reasons — is a contractor worth being cautious about.
Skipping required permits can create problems at resale, complicate insurance claims, and expose the homeowner to liability for code violations found after the fact. Ask directly who pulls the permits and confirm that the scope of work will be properly permitted before work begins.
Insurance
Do you carry general liability insurance, and what is the coverage amount?
General liability insurance protects the homeowner if the contractor’s work causes property damage or injury to a third party. Without it, the homeowner may bear financial responsibility for incidents that occur on their property during the project.
Ask for a certificate of insurance rather than simply accepting a verbal confirmation. The certificate should name your property address and confirm that the coverage is current. A reputable contractor provides this without hesitation.
Do you carry workers’ compensation insurance for your employees?
Workers’ compensation insurance covers medical expenses and lost wages for workers who sustain injuries on the job. If a contractor’s employee is injured on your property and the contractor does not carry workers’ compensation, the homeowner may face legal and financial exposure.
This is particularly important when work involves subcontractors. Ask whether workers’ compensation coverage extends to all workers on the project, including subs, or whether subcontractors are required to carry their own.
Experience and References
How long have you been doing this type of work, and do you specialize in it?
General contracting experience is not the same as specific trade expertise. A contractor who primarily builds additions may not be the right choice for a detailed restoration project. A roofing company that primarily handles new construction may approach a historic home replacement differently than one that specializes in older homes.
Ask about experience specifically relevant to your project type. A contractor who has done fifty projects similar to yours brings a different level of practical knowledge than one for whom your project is a new category.
Can you provide references from recent, similar projects — and may I contact them?
References are one of the most underutilized tools in contractor selection. Most contractors provide references when asked. The useful follow-up is actually calling them.
When you speak with references, ask specific questions: Did the project finish on time? Did the final cost come in close to the original estimate? How did the contractor handle problems or surprises? Would you hire this contractor again? The answers to these questions tell you more than any sales conversation will.
It is also worth asking to see completed work in person if the project type allows it. A finished kitchen, a completed roof, a restored exterior — seeing the actual work product in context is more informative than photographs.
Process and Communication
Who will be on-site managing the work day to day?
The contractor you meet during the sales process is not always the person running your project. In some cases, the company hands project management to a site supervisor or foreman you have not met. Understanding who will be your primary point of contact during the project — and meeting that person before work begins — sets a clearer expectation for how communication will work.
How do you handle changes to the scope or unexpected conditions?
Every project of meaningful scope encounters something that was not anticipated. A wall that opens to reveal a plumbing run that conflicts with the plan. A subfloor condition that requires more attention than the inspection suggested. How a contractor handles these moments is one of the clearest indicators of their professionalism and character.
Ask specifically: how are change orders documented? Who authorizes additional work? How quickly are surprises communicated to the homeowner? A contractor who handles scope changes through informal conversations without written documentation is a contractor who creates ambiguity about cost and responsibility.
How will you communicate with me throughout the project, and how often?
Communication expectations are worth establishing explicitly before a project begins. Some homeowners want daily updates. Others prefer weekly summaries. Most contractors have a default communication approach — and knowing whether it matches yours before work starts prevents frustration later.
Ask who you should contact if a question or concern comes up. Ask what the expected response time is. These are small questions that have a large effect on the experience of being a homeowner during an active project.
Financials
How do you structure your pricing — fixed bid, cost-plus, or time and materials?
Different pricing models carry different risks and benefits for the homeowner. A fixed bid provides cost certainty but may include contingency padding that you pay for whether or not it is needed. A cost-plus model ties the final cost to actual labor and material costs plus a defined fee — providing more transparency but less upfront certainty. Time and materials pricing is most common for smaller or less-defined scopes.
Understanding which model applies to your project, and what the implications are, is foundational to evaluating proposals and avoiding surprises at the end.
What is the payment schedule, and what triggers each payment?
A payment schedule that front-loads payments to the contractor before work is completed creates risk for the homeowner. Most reputable contractors structure payments in stages that correspond to project milestones — a deposit at signing, progress payments as work advances, and a final payment upon satisfactory completion.
Be cautious of contractors who ask for a large percentage of the total cost upfront. Be equally cautious of those who are vague about what triggers each payment milestone. A clear, written payment schedule protects both parties and creates alignment between progress and compensation.
What is your policy on cost overruns, and how are they handled?
Ask directly: what happens if the project costs more than the estimate? The answer reveals how the contractor thinks about pricing accuracy, contingency, and the homeowner’s financial exposure. A contractor who has a clear process for communicating and authorizing overruns before they occur is a fundamentally different working partner than one who presents additional costs after the fact.
The Contract
Will the full scope of work be documented in a written contract before work begins?
A verbal agreement is not a contract. A written contract that clearly defines the scope of work, the materials the contractor will use, the timeline, the payment schedule, and the process for handling changes is the foundation of a professional contractor relationship.
Review the contract carefully before signing. If anything is unclear, ask for clarification. If the contractor resists putting agreed terms in writing, treat that resistance as a significant warning sign.
What warranties do you offer on your work, and what do they cover?
Workmanship warranties cover the quality of the installation — if something fails because of how it was installed, the contractor is responsible for making it right. Material warranties cover defects in the products themselves; manufacturers typically provide these directly.
Understanding what your contract covers, for how long, and what the process is for making a warranty claim protects you after the project closes.
The Question That Reveals the Most
Beyond the specific questions above, there is one broader question worth asking every contractor you seriously consider: How do you handle it when something goes wrong?
A contractor who answers this question directly — who describes a specific process for problem resolution, who takes ownership rather than deflecting, who has a clear example of how they have handled a difficult situation well — is telling you something important about how they operate.
A contractor who deflects the question, who insists that problems rarely arise, or who becomes defensive when the question is asked, is also telling you something important.
The quality of a contractor is revealed most clearly not by how they perform when everything goes to plan, but by how they respond when it does not.
How RESIDE Approaches These Questions
We believe every homeowner should ask these questions — of us and of anyone else they are considering.
At RESIDE, we are licensed and insured across Minnesota, Wisconsin, Illinois, and Colorado. Permits get pulled. Scopes go into writing. When conditions change, we communicate proactively — and when something does not go as planned, we handle it directly.
We work across remodeling, restoration, windows, and real estate — which means homeowners who come to us with a project can have a single conversation with a team that understands the full picture of what their home needs, not just the narrow piece that falls within one trade’s lane.
If you are evaluating contractors for an upcoming project and want to talk through what working with RESIDE looks like, we would be glad to have that conversation. Reach out to the RESIDE team here.
Frequently Asked Questions
How many contractors should I get bids from?
Three is the conventional wisdom, and it holds up in practice. Multiple bids give you a basis for comparison on both price and approach. They also give you more information about how different contractors think about your project — which can be as valuable as the price comparison itself.
What should I do if a contractor asks for a large deposit before work starts?
Ask why the deposit is structured that way and what it covers. Some deposits are legitimate — covering material orders that require advance payment. Others are simply a cash flow preference. A deposit of more than 30 percent of the total project cost before any work begins is worth questioning. A deposit above 50 percent is a significant red flag for most project types.
Should I always choose the lowest bid?
No. A bid that is significantly lower than others usually reflects one of a few things: a narrower scope, lower-quality materials, less experienced labor, or an intent to make up the difference through change orders later. Understanding why a bid is lower is more useful than simply selecting it.
What if a contractor does not carry workers’ compensation insurance?
Ask why not and consider the implications carefully. In most cases, a contractor without workers’ compensation is either using workers classified as independent contractors — which carries its own legal complexity — or is simply operating without required coverage. The homeowner’s liability exposure in either case is worth understanding before proceeding.
Is it reasonable to ask for a contractor’s license number and verify it?
Completely reasonable and strongly recommended. Reputable contractors expect this and provide the information readily. A contractor who resists or becomes defensive when asked to verify licensing is worth reconsidering.
