I've been a licensed and bonded independent residential remodeling contractor for over twenty-five years now and can vouch for every single one of these from the devil's side, lol, having experienced the pain that comes from not adhering to these rules both as a contractor and a home owner. Kudos for an excellent video.
You're also poor and probably complain about taxation. This is all poor people scarcity stuff. U get what you pay for. Not working for free or cheap. A guy at NASA made 1,000 for tightening a bolt? I the best thing about the best country in the world is that we are still free to charge whatever as ridiculous as if sounds. And I I'm good at it you bet I'm gonna hold you hostage. Pay up or git. That simple. And then the buyer becomes enraged when I refuse to accept the price that they value me at. Seriously? How about I come to your job, perform an inch-by-inch analysis of everything you actually do, and then reassess your value as a human? I'll come to your corporate office or hospital where you work. When I catch you texting your moron associates or looking at photos I'll assume you do this daily. I'll count all your time wasting and formulate an average n of hours you waste and then I'll find other relevant variables in your line of duty and Ultimately decide that I can automate your job, pay you minimum, and keep you as a part timer. In your case, I'll count All the time you waste at Ace hardware looking at tools and supplies and products that are completely irrelevant to the project at hand. Tell me I'm lying I'm an administrator, entrepreneur, market and most recently--builder. Because the morons I was employing at age 17 thought I was only capable of hitting keys and scheduling jobs. Turns out I can work faster and smarter on the computer AND with a drill. I wanna see this guy pushing a wheel barrow for an hour. Let me put you both to work and remind you where you came from. Maybe he didn't come from where we or I came from. I might as well be from Tijuana or Africa. Oh and Im a real estate advisor...same thing. No one understands the hard work involved. Both trades need to.....trade for a week and then go talk smack about one another.
I’m a foreman for a contractor, This guy is telling the truth, and honestly I’ve seen even worse, I actually have wanted to start my own company just because I’ve witnessed so much and I know I could make a ton of money just by being honest. This guy is credible
Another reason why people just let their home repairs go undone. Too much stress and anxiety trying to find an honorable contractor that will do the work correctly, at a reasonable cost, without ripping you off!
I'm a contractor just starting out that has worked for years for a very honest contractor. your video has given me a few tips on how to continue to do honest labor, because our marketing has mostly been word of mouth and usually that word is "they're honest". I want to keep this reputation while starting out on my own and your video has given me tips on staying that way. I was irked, to be honest, because 99% percent of these "scams" we have never done, and the ones we have were not out of ill intent or was offered by the customer. And yes i am offended by many of your "they" statements but at the same time I see the others that we have to come in and finish the job behind. so as crass as your video is, your video has helped me to stay and honest contractor. thank you.
And insist on seeing actual samples. My sider sent me to other homes he had done to see materials used and then turned around and used different materials on mine!
I was a contractor for almost 50 years and I wish my customers had seen your video. The contract works both ways and I can only guess at what some of my customers must have been imagining. BTW I never advertised my services, it was all word of mouth - be square with people and you'll never lack for work.
You identified the biggest problem. Homeowners have a habit of imagining that contractors can read minds. Make a detailed list of your requirements and make it part of the contract.
@@facehairteeth That's a good idea but they still quite frequently screw it up. The upside is that if you have everything in writing they either have to correct the problem on their dime or you can fire them and they really don't have a leg to stand on to sue you for any work not done to spec. So you just pay them for what they did correctly and tell them to hit the road on the rest. Most of the time though they are honest enough to just fix the problem in large part because they know their guy screwed up and they don't want a small problem to become a big PR nightmare.
"I'm not in a hurry." Yes, I made that mistake years ago. Hired a guy end of August and gave him a down payment. He showed up in the middle of October, and only after I psycho-called him, from different phones since he stopped answering when he saw my home number. Live and learn.
I mean he should’ve been clear about the timeframe from the start, so that you weren’t expecting him to start right away, but if you hired him in August, starting in October is REMARKABLY fast, especially right now. Right now, the company I work for (kitchen & bathroom renos) is booked out for months, we’re currently taking deposits for jobs that’ll start in like July-August of next year. The fact that you got a guy out there in less than 2 months is remarkable
@@Dreadlock1227 I don't think he would have come back at all had I not called him from different numbers. He lied to me, and then he did 3/4 of the job, threw down his shovel and departed, never to be seen again. By then I was too tired of it all to pursue him.
I greatly appreciate your enthusiasm for proper dealings with Contractors. All of your points are well taken, and says a lot about your experience. Thousands of people would be better off if they heeded your advice. Trust no one. Get educated, learn, If we all did this properly, many contractors would accept the fact that they need to be more honest. You have armed us with great principles dealing with contractors. I know you have saved many people a great deal of financial losses, fustration and poor workmanship. Thank you Phil.
I am a contractor, and I don't walk on water, sometimes things just do not go as planed. One thing I will say is the people who are the angriest at me all fall into one category, and that is the people i won't work for. Someone will get a good recommendation from a previous client of mine. They will call me to come over and give them an estimate. If I sense any attitude like Phil's or if they lack normal sense of fair play or flexibility, i just tell them I am not interested and thank them for their time, and go stright for the door. A good contractor dosen't need work, what they are looking for is reasonable people who have a sense of fairness. When I go for an estimate the main thing I am doing is evaluating the client to see how they might react if something dosen't go right, and trust me even the very best contractors run into problems.
I'm a remodeling contractor. I hear a lot of horror stories like this. I know there is something being left out of the story. That something is they hired the cheapest bidder or the first person who agreed to come out. Take the time to develop a relationship with an honest contractor like me. Don't be in such a huge now, now, now rush that you can't wait for your regular honest contractor to get an opening in his schedule to get to your project. Don't expect people to work for free.
dont bid what you cant do lot of people put up a front to get that job they havent had a job that big before and are winging it out of 5 guys i hired to admin my server the lowballers cost me $1000.00 and 6 months aggrivation the $125.00 hr guy fixed all there screw ups and got my never gonna happen wish list done in under 30 min
Called 70 contractors...70 for a remodel job on a vacant house. They either didn't call back, didn't show up, or had excuses as to why they couldn't show up.
I'm a first time homeowner and are looking to complete a few projects this year. Thank you for sharing your insight. I'm always worried of getting ripped off.
@@jennifurzoe1302 Or rent a port-a-potty. In hindsight that's what I would have done as it was a two month job and for number ones he just went to the back of the yard and let fly. Disgusting!
Be very worried. It's fatal attraction for real. I don't want to sound negative, but it's almost going to happen at some point. You just have to minimize the amount of times it will happen. You're one person with a small budget. Imagine how much companies lose annually from employees they hire, train, and educate only to be abandoned, stolen from, lied to, and misrepresented. They just have more resources to take the repeated hits. We don't.
So what I got from this is: 1. 3 bids minimum (make them compete) 2. verify materials and labor costs are justified 3. only pay upfront costs that make sense but never over 20% project cost 4. Tell the contractor you expect it done in a timely matter or simply put industry standard. 5. I choose materials while also taking advice consideration from experts. 6. Always check and see who is doing the work. 7. If its not in the contract it either better be before the project starts or I aint paying it.
Great points Phil! I would add as a contractor, never tell your contractor that you aren't or don't want to get permits for your renovation. You will get a cheaper quote but it won't be to code and it will be rushed, poor quality work that is more likely to fail.
Wow It's is truly sad how easily contractors rip people off with a straight face, I know 2 brothers who has been in the business for approximately 30 years and about a week ago I asked the one a question about contractors and was disappointed to hear that he mentioned that they are all a bunch of thieves, all of them. This was truly disappointing to hear, I believe them because I have known them for quite some time now. I do also believe that not all contractors can be this evil, but the honest ones are not easy to find, this has to be true.
You want the customers picking out materials? Thats insane for me an electrical contractor, no way I want the customer picking materials, even if I make no money on it. They pick out the wrong/inferior stuff
I agree with everything you have said. Specially get every detail in writing. You can tell right off the bat if a contractor doesn’t want to give a detailed list of “everything”. They are trying to rip you off. As far as estimates go, get a dozen! You really need to do your home work about proper workmanship for the application and the right building materials. Contractors don’t like when you point out building materials that have to be installed in a certain way or warranty will be void for that product. The last line in my contracts states” process will be videotaped”. If that doesn’t scare off the crooks nothing will! The great ones will ask for a copy of that tape to use for promoting their business. Don’t just hand it over, bargain with it, it was your time and effort. Their times worth money and so is yours.
This is SUCH good info. I'm sure the issues are magnified at the commercial and higher-dollar residential level, but even on small household jobs like fencing and irrigating and painting there is something to be learned.
Ironically, points 2,3,5, and 7 are also frequent ways that unscrupulous homeowners screw well-intentioned contractors. A reputable contractor will always design a contract that protects contractor and client. He will set his own parameters for timely completion and detail what he must complete before each draw, and leave little for the client to necessarily negotiate. Material cost is a touchy subject. A reputable contractor will protect himself with a reasonable mark-up or contingency, especially with "prospect" clients...that is, the ones who "aren't in a hurry" or "just want to see what it costs first." People who knee-jerk select the lowest bid from someone who didn't properly cushion their estimate frequently find themselves with a contractor who nags for more money or walks off with the job unfinished. How much are you saving after you pay the contractor you should have selected the first time to redo and finish what Discount Daryl and Slip-shot Sam walked off and left?
Agreed is this guy even a fucking contractor??? If the materials are 550... and they are charging you 850 its because of material procurement costs, deliveries, labor to gather said materials and time spend getting materials. This guy is a clown
I have fixed and flipped over 20 properties and here are some of my the best ways I have found contractors. Ask other contractors - they pay attention to each others work and they know who does quality work. Home Depot - Call me crazy but I sit at home depot and eat a hot dog and look for the following: 1. Contractor with truck - Small projects you don't need a GC unless you a beginner. 2. The way they carry themselves. A man that cares about his appearance will usually care about his work. 3. Mannerisms - Does he appear to be organized? Is his truck a mess? Does he talk over you? 4. Beware of contractors who can do everything. When they say I can do everything, I reply with if you had to choose one specialty what would it be. My favorite way to hire a contractor is to stop by when I see guys working and look at their work. Sometimes they will refer you to their boss and I reply with I am looking for guys who want to do some side work. Think about it, why pay the boss when he is not the one doing the work. How to pay contractor? Be safe and smart - Pay for material up front only! Weekly pay based on line items completed. Contractors have families and need to eat. Be fair! Never pay early unless you built trust with your contractor because this is a easy way to get screwed. Offer incentive if he finishes before deadline! Why not you both win and he will be eager to work your next project. Request invoices, pictures and video weekly before payment. They create your timeline for you by the week. If something not complete or you have a disagreement you have proof that they created. Penalty for for not finishing on time. $100 per day for each day past agreed upon completion date. Invoices should be so detailed that it includes door knobs. Penalty for for not finishing on time. $100 per day for each day past agreed upon completion date.
"WHY PAY THE BOSS" I like that, in other words you think you are smart right??? WRONG, because the boss owns the company that gives you a warranty on that job, the Boss is the one speaking English so you wont get frustrated trying to get your point across, good luck trying to get those workers back to do a touch up, because they will be busy with the work the Boss gives them, and you will be waiting long time , AND MOST IMPORTANTLY IF SOMETHING BAD HAPPENS (AND I WISH IT DOES, SO YOU LEARN A LESSON) , WHICH INSURANCE ARE YOU GONNA MAKE A CLAIM ON ???? In other words : YOU ARE AN IDIOT
VERY BAD ADVISE ON ONE PART = The boss is the one who carries the insurance! Not to mention, that's called moonlighting and most employees sign an employment agreement stating that it is illegal for them to moonlight. Also, here in South Dakota that is also soliciting and you can be charged a crime for trying to convince my employees to perform work on the side that is unregulated, uninsured, and performed without a permit. Because the boss is the one who can pull a permit.
For the ladies, in my experience as a woman, the most critical thing I do is educate myself. I not only read reviews and ask neighbors about quality contractors (Google, Nextdoor, etc), I also educate myself on the details of the project. When I do that, I can have an intelligent conversation with the contractor by understanding the language and realistic scope of the project. SOME contractors will assume being female, you are not knowledgeable and will attempt to financially take advantage of you. If you are able to ask specific questions (and comprehend), you can avoid a lot of headaches. And sometimes you realize you're actually smart enough to install that toilet yourself! 💪🚽😁 I'll also add that I haven't had a bad experience with any contractor I used, and I feel certain it's because I invested the time to research who is doing the work and how to accomplish the final product. Good luck on your future endeavors!
I believe it's something within me that I continously get screwed by these contractors. I did my research and asked all the questions and hired a contractors that I feel comfortable to do the and the work ended up sloppy the refused to fix minor things because they already passed the inspection😫😫
As a single female, living alone, the tricky thing for me has been that if I do research to try to be knowledgeable enough to simply explain the issue, it seems to put some men off. Even if it’s something really simple. The last time I called someone from my heating company I said to the guy, “Last time I had this issue with my boiler it was because the pressuretrol pigtail was clogged with sludge, which led to other problems.” He then had me run the shower with the hot water on and proceeded to explain to me that water, when hot, will make steam. 🤪 My radiators were going off heat in the summer whenever the boiler kicked on when I showered. The heat was off. It was 90 outside. He left and the next day I had to call the company back and request a different technician. In the future I’ll find some costume wedding ring and say “We” and maybe rent a fake husband for the day. And this was just an inconvenience lol. I’ve grown much smarter with actual contractor situations, but still always feel like I’m probably being “pink taxed.”
As a contractor myself I agree with most of Phil's points except I will not do certain jobs with customer supplied materials. Yes, if you haggle with a supplier they will discount for bulk orders but you better believe they're going to go out of their way to get rid of the worst materials they have on the shelves. They generally wont do that with us because we deal with them daily. I get all my work from referrals and I feel that is the best way to find a contractor but ALWAYS do your research if you've never used them before!
i do light plumbing work now and then for investors...faucets. toilets etc.. they always want me to buy the cheap home depot glacier bay junk and i say ok but not gonna warranty anything..3 months later i am back fixing a leak and charging them a service call which is usually double what the good moen or delta product would have cost in the first place.
I disagree. Material Suppliers aren't nearly as loyal to contractors as contractors may think (or try to convince clients). I can walk into any supplier and get a contractor's account set up with them quickly and get the same discount as a contractor. But contractors are pros at convincing people that they can get a better discount than us non-contractors can. In the real world, I have seen where it is simply not true. Plus, material suppliers really like me because I always pay on time and/or upfront; unlike some contractors that fall behind on paying their materials tab
Phil Pustejovsky I think what Bucko is saying that he frequents the supplier much more than someone flipping 3 homes a year(not you, your audience), hence has a more personal relationship .
What you're saying Phil is that your relationship with supply houses is better than the contractors, because of your longevity with them, and you pay cash up front. Makes sense, of course. Nothing wrong with that. Why not mentor contractors as well? Shitty contractors are everywhere. They need a course too. I think what I'm getting at is that stop bashing us low-lifes that can't do biz 101 and turn us into super-stars for rehabs! LOL! Just a thought man!
This happened to my boyfriend. He gave a contractor $2000 up front to get started on a job fixing old doors in our house and we never could get ahold of him again. He took the money and disappeared. At first when i found out boyfriend gave the guy money i though “oh Jeez” i would never do that, but my boyfriend is such an honest person, he is clueless about how some people can be.
Great video! The amount of problems I have had with contractors; just rehabilitating one house, could fill a small book. Here’s one for you: Two identical Steele entry doors: one exterior, one interior, each with a different swing - one swings in right, the other swings in to the left - purchased in December from a big box store- not installed correctly until September of the next year: issues, wrong doors, door installed backwards (redone), one door of one type and color, one door of another type and color, wrong hardware packages, wrong Caming-color: black not Puter around the glass, wrong hardware color: mismatched Satin Nickel and one Black, changed sub contractors: three times, and so on. It took a complaint to the Attorney General of Connecticut to get five contractors on my porch and the job finished correctly; the same day; nine months later 😳: No BS! One door still has a quarter inch gap on one side to this day incidentally. What a frickin nightmare! I used to refer to my house in those days as “The Nightmare on Noble Street.” This one issue with the doors set my schedule for total rehabilitation project(s) completion back by at least a year; @ least. I won’t even get into the stress and demotivating factors involved. It took about five situations like this one to change the way I deal with contractors and now each transaction is a lot smoother, but still fraught with risk!. A Big thanks goes out to Richard Blumenthal and his staff for their help. The fact that I even needed to get the Attorney General’s help is the point; cautionary tales abound and people need to be educated about the risks of dealing with contractors; moreover, how to develop back up plans to work around problems that arise around the processes inherent in rehabilitation of properties. After being screwed over a bunch, I wish I had had a mentor along the way; perhaps then I would have seen a video like this one to learn to know how to negotiate around the pitfalls in the contracting process. Now, I almost always exclusively contract with Brick&Mortar Business Owners who have a verifiable record of stellar performance, and a business location that is more than a pick-up truck! It costs a little more, but it’s worth it. Also, substance abuse issues abound amongst this skilled labor group: I sometimes make a point to mention that my property is a Drug and Alcohol Free Zone: meaning there is a Zero Tolerance Policy that includes a clause that verifiable use of substances or intoxication on my property = non-payment! 12-Step Recovery Clubs can be a great place to find Clean and Sober Contractors looking for work by the way. There are many contractors out there who do amazing work that I couldn’t; when the contracting process goes well; smoothly - amazing property transformations can occur. My Nightmare on Noble Street is now a Cozy New England Cottage Beach House by the Sea... but achieving this state of transformation of the house from the former mess it was - was not easy; but, the lessons learned - are definitely invaluable! Thank you Phil👍🏻. RB/CT
As a plastering contractor i agree 100% with this guy , years ago an elderly couple hired a GC from their church to do a 20k job but charged them 59k i was hired to stucco two columns by the crooked GC I charged him 600 he charged home owner 3500 just for what i did homwoner asked me what i charged long story short i helped the old man getting GC charged with crime
Right? other day watched a youtube video where some sistas were twerking in church to the tune of ''oh happy day'' lol. i thought to myself man! this are the last days.
Thank you, Phil! I have made most of these mistakes. Still have a contractor who did one job well so I gave him money up front for a second job and he skipped. Wish I had you to do my negotiating for me. Be safe and God bless.
As a single woman and business owner I can happily say I have always had good deals... because I stuck with all these rules all these years! Always at least 3-4 bids! It’s not just the price either. You want to pick someone you LIKE. I like buying my own materials (like faucets and bathroom cabinet) and getting a fair estimate up front for installation. Also, I want to see a nice folder of photos of previous jobs. Also, before hiring someone for a very big job, hire them for a small job and see how good it turns out. This will give you a preview of coming attractions. Ask a lot of questions, that way they are more careful not to rob a well informed client. If they out talk you or get arrogant or defensive, they will be hard to work with. Don’t be afraid to oversee the work. Some of these guys don’t have a lot going on in the Common Sense department. If they pull a no show, don’t bother calling them back. Chasing people to work is no way to do business. If they don’t respect your time or have integrity, don’t enable them because they will keep being that way. Make sure you get a Playbill of how the progress of work is to be done and always ask how long it takes to do it. Anyways, all these things matter when living in a world where finding the right contractor is like being a boss hiring an employee. What makes you the boss? Your wallet.
Worked with contractors on 2 home remodel projects. In my experience here is what they start with: " CASH " . They all ask for cash, even on bigger jobs 30k or more. Than you eliminate the cash folk and get " reputable " company where the person that gives the estimation does just that and is always nice, professional and knowledgeable but the workers they send on the job are cheap labor, lack experience, and I had to watch every step they take and waste time also because they cut corners. Examples here: cut footing on the home instead of drilling, cut through supporting wall when placing ductwork, incorrectly placing/ sealing vents on the roof causing leaks in the bathroom, etc, etc. I heard them brag about giving people ridiculously high estimates because they are so busy, and being surprised that home owners accepted.
NEVER pay cash unless it is simple service call. Your money should be traceable to prevent liens. ALWAYS get lien waivers from your contractors subs and vendors. You can get partials through a certain date of final unconditional at the end of the project.
..i am a contractor and a real estate investor..i gotta say for the most part i agree... always all kinds of variables though. those small quick jobs can turn into big ones real quick...i work in massachusetts where asbestos and lead paint can easily double the job cost.... by law we must have a written contract for any job over 1,000$ and can only take a max of one third up front.
Very valid points. Definitely get everything in writing, get before and after photos as well. This not only protects the consumer but it also protects the contractors as well. We try to educate our customers about the mistakes of going through those fly by night contractors and how to find someone or a company who will do a good job and who will stand by their work. Good Advice man! Keep it up!
even in writing, they don't care. prepare as if you are going to court will help though. they still don't care. even if you win, they will take off and never pay.
@@timrich6755 that can back fire too, so check friends and a few more customers of the person. sometimes the friend gets good service and you get screwed
Great job. Just want to add. Be there as much as possible. Almost every time I contract a job... a contractor find a "different" surprisingly easier or cheap way.
I appreciate you making this video! There are not many people like you out there who tells the full truth regarding this stuff. Thank you brother, again I appreciate it.
12 Years in the Foreclosure/Preservation/Asset Management business- and everything is SO TRUE! Live and learn- but it's much better to KNOW and learn before you lose out on TONS! Thanks Phil!
I have been screwed over so many times by contractors I had contractors remove and replace drywall and just a few months later I got a call from my rental tenants that the drywall is starting to pop of the wall because they didn’t use screw they used nails And also I had the contractors sand and re-stain the hardwood floors in my rental property and they left the floors bumpy and wave and a few parts of the floor had puddles of the clear coat that had hardened before they even smoothed it out and when I got back with them to fix the problems they made ,they said that had never restored floors whereas in there listening it said they did
Bay Whedon Goes with the territory, when I hear rental property. Owners are usually gaming for the lowest bid, knowing full well the tenant won’t be gentle with their property.
I'm cringing as I watched this. I hired an electrician to upgrade main box and add a switch in a bathroom. I didn't get paper estimate. I never got a receipt for work. I had to keep calling him back to finish. I think I got ripped off. I'm actually glad he didn't do the long list I wanted.
@@CandycaneBeyond Wrong. Karma was derived from cause and effect. Later adopted by idiotic high priests to control the masses by fear. Nothing more than man made. Take care. :)
Check and see if your state requires electricians to be licensed (it could be per city or county also). The licensing in Texas is through the state. By Texas state law he is required to give you an invoice for payment. If its in city limits then a service change requires a city permit followed by an inspection. The invoice must have all of his information on it including license number and the 1-800 number for the State. the state even has a search on the website so that you can make sure he is insured and in good standing.
I work for a GC who absolutely prides himself on being crystal clear and keeping everything on the up n up. If i ever acted anything like the contractors you seem to work with, my ass would be in the unemployment line faster than anything. The only even remotely shady thing we do is that if we're doing a trash haul from old tennants, we'll take any cool things we find.
LMAO! I'm loving your passion Phil!!!! I'm just Realtor right now but I'm working towards becoming an investor. The NO BULLSHIT lessons like this one are GREATLY appreciated and I'm very much looking forward to learning more from you ; )
Yeah l heard you man , l just start doing on my own as a small Drywall finishing company and l had been doing some side jobs ,but l always get pay till my job is done l will wait till the owner check my job and approved,.
Happened to my relative, he basically made his accountant rich because he trusted him while he himself couldn't figure out why his company had all this business but he wasn't making any money. Never ever trust people with your company finances, you will be stolen from.
Excellent video, looking forward when buying my next new home to be able to keep one step in front of the builder's run around and being able to figure out if he is BS ing me.
The comment about the bookkeepers stealing money is hilarious. But it does remind me of something my mother told me once and that is NEVER give someone else control over your money. As soon as you do you'll get screwed.
For every dud out there, there is multiple good honest contractors out there . Non the less be careful for the duds , you usually can spot them before a job starts with some effort .
NO NO NO NO...If you think it's a one-for-one trade off, you need to tune in to EARTH. Far more low character than high character. If what you said were true, it would be a breeze to find a moral contractor with integrity--it AIN'T.
I wish my daughter had seeing this video before she got screwed royaly by this contractor. I'm definitely will follow your advice for future projects. thanks for sharing this video.
Phil, I really appreciate your taking the time and energy and thought that you put into the making of this video. It is obvious that you are experienced in REI, and this is VERY HELPFUL to us newbies. Thanks Again
Please don’t lump me into the unethical contractor group. There are plenty of good contractors. I agree to having a signed contract by both, the homeowner & the contractor, before work starts
Usually it is the upstarts that can't be trusted, most established Contractors have to be honest. We charge higher rates but are always swamped with business.
warren thomas yes he did lump ALL contractors together. As an honest contractor, I’d never work for this tool. Many, but not all realtors are cheap-crooked to their contractors.
@@warrenthomas1253 Actually, he did lump @Chad and every other legitimate contractor in with the bad. He never states that there are legitimate contractors, performing their duties in a professional and ethical manner. Instead, he makes it clear that contractors "usually can't look past Friday afternoon" as if to say there are no contractors operating their businesses professionally with adequate margins to sustain their organization beyond a week. While I love his enthusiasm and his clear contribution to educating the general public regarding topics surrounding real estate; his personal experiences (or should I say choices) have led him to make generalizations that are not fair and inaccurate. You know..... He comes off as the scorned wife who wants to lump all men in as dogs because of her bad choices in picking men. This guy is clearly looking for the cheapest deal he can find, and then complains when he doesn't get top notch service. The two (cheapest deal & top-notch service) hardly ever go hand-in-hand.
I am both a real estate investor an contractor and I agreed with most of what you said. Like you said, as a real estate investor it's better for you to buy the materials directly. If they are going to supply materials they will give you a flat price, I don't think it's necessary to brake down materials and labor. One thing as a contractor that I learned is that if you don't ask for something down a lot of people will waste your time or change their mind. A down payment forces them to commit to hiring you for the whole project. You have to watch what you say because a lot of course tractors expect some level of trust and you don't want to insulting them. But yes, contractors are notorious for screwing people.
Well spoken. Clients needs to have skin in the game or they will string out contractors. If I was a contractor, I would demand a deposit. I always pay my contractors deposits.
A lawyer informed me that one of the main tenets of a contract is "There is no contract without consideration" AKA $$$ Pd. That's why I always get a deposit or don't do the job. Then too If there is going to be a deadbeat it will be the guy balking on the deposit. I know someone in the jewelry Bus.They do business on a handshake or a memo signed on tens of thousands of dollars. I wont trust the public on 5 Hundred.
I had my first custom home built when I was 22 years old. And I expected honesty and good faith. Got rid of that idea really fast. I also pay for an ON SITE CONSTRUCTION MGR who verifies the deliveries, materials, quantity and type. He also verifies the hours of each employee I am paying for - clock in and clock out times. My ON SITE MGR is also responsible for security, locking up, opening up, keeping the insurance paid, keeping the alarm systems up and running, etc. I pay the guy well. Very well. But it eliminates cheating an using purloined materials. In my 2nd house we had a full indoor kitchen, and coffee /breakfast prep areas in the MBR, and the pool house, and in a guest suite. Each of those got a 2 burner Miele Induction Cooktop installed. One of the subs tried to substitute an unknown brand of dual burner induction cook top. I caught it and found out the cook tops he was trying to install were stolen out of a wear house store a year ago. They were cheap Asian products and it didn’t work. The police had documented the burglary and arrested the contractors that provided these things. I also have my subs accounts verified, hours worked, labor contracts, etc. I do not often use A GC. I can run payroll for a group of 50 men, including taxes, and making sure my work is paid off when it’s completed. Not a chance of some idiot trying to file a material man’s lein. When I notice someone doing more than I expected, or working harder, better, etc., I ususally will include a BONUS PAYMENT along with a thank you note. You would be amazed at how much good will an extra 100 or 200 or 500 dollars can buy. The problem I’ve had is that these idiot contractors don’t think I know what they’re doing. My onsite Management guys that I use generally have a legal concealed weapon permit. I have had contractors threaten me, until my manager let him hear the click of a bullet going into a chamber. That calmed the bastard down very quickly. We called the local PD and had the idiot contractor arrested. He sat in jail for two weeks until the judge called me and asked me if I would allow the charges to be reduced. And with good reason. You managed to open so many naive eyes in a short period of time. And sadly, these contractors are often crooks. The ones that are fully honest, quickly become so costly that a normal person cannot afford them. Figuring the best contractors will cost you about 30% above cost. If you’re paying any more for them, you’re being screwed. I routinely get excellent and honest contractors in Electrical, HVAC, Plumbing, Wiring, and framing and finish carpentery. I will now tell them I will allow them NO MORE than 25% above cost. The guys that come in lower than that 25 percent figure may have a better chance of getting the job.
Unfortunately I fell for many of these mistakes thinking that everyone out there is a good person and perform honest work, but now I am chasing both the contractor and subs around to get this job done! Luckily, the job is smaller $10,000, and is not coming out of my pocket directly, but still wanted to get this done correctly. Wish I saw this video sooner. Would have saved me a lot of time and energy
I am currently in my first quick turn which is taking 3x as long as expected because I made all of these mistakes except #3, but I ended up getting screwed badly by telling them my budget...won't be making any of these mistakes again! Thanks Phil!
Thanks Phil for sharing basic but important information. I'm working on my first investment property and have yet been able to find the right contractors for the job. Hopefully learning from you will assist me thanks!
@Jerry Moody KUDOS to you, I'm sure most people don't have the gusto to do what you did. I'm an HVAC technician and it's not an easy job. I commend you for buying the tools and doing the installs you have done. I have to say that it is legal for a homeowner to buy his own unit and maybe even install (maybe not, idk) it. In the end it just seems like bad practice to install other people's units without a licence.
You, sir, are an amazing speaker. I think this whole home improvement industry is messed up. I had such bad experiences with contractors not answering the phone, now showing up and running multiple jobs even after being paid, I go with companies who have angry (in a good way) people like you as managers to keep the subcontractors on a leash so they complete the job. Worth the extra 20% you pay. Just IMHO. Every homeowner should watch this video as many have lived this nightmare.
Phil, you are spot on with this video. This is Dan in Donelson. I was just like you. Real nice guy, trusted everybody... Then the first Contractor I hired to take the fallen tree off my house, He tried to screw me.... He told me that I don't have to pay a penny, and he will deal with the insurance company directly, no need to worry. Then, a month later he sends an invoice for over $14,000!!! WHAT! This was a 3k-5k job tops. SO, he put a lien on my property, and I got a lawyer, then he pulled the lien off after hearing from my lawyer. What a Total Douchebag! Never trust ANY Contractor. I wish I saw this video before the tree fell on my house... Thanks Phil!
I have to agree with all of this. My contractor told me last week that the flooring I had picked out was 'discontinued' and asked if another would work for me, I said yes before checking to find out if he was being honest; he wasn't, the flooring was still available. They are doing a horrible job and everything except for the windows look like they came from a scratch and dent sale. What a disaster.
This is so true. I lost over 80k of three of our flips here in new york, and to take them to court is another 15k plus 3 years of litigation . Sad Face. The people are not your friends.
Phil, #7 is very important. I had a "friend" bid a very small siding job for me . When it was all said and done he tried charging me almost double the agreed upon price. Thankfully I had priced the materials and stood my ground, but in the end I got the job done for the original agreed on price.
I visited a mechanic and asked him how much the labor was to install an exhaust system. He said $150. I said I had the parts- he told me to leave. I challenged him- it got heated and said what's your deal. He flat out said, I make money by marking that stuff up a lot...then again, suggested I leave...which I did.
Looked for roofing contractors. Due to recent storms hard to get anyone. Found Web reference... FAMILY RUN BUSINESS FOR XX YEARS. So I rang them... Yep they are family run business. They put me in contact with local rep (first clue missed). Rep came out, seemed roof smart. Quoted $5500 but discount for cash, to $5,000.(second clue). So staggered payments seemed OK. He then got another man to do the job. Asking me not to tell him what I was paying (third clue). 3/4 way through the job, rep said he had to go overseas and pay the worker the final $1000 owed. (weird but to late for a 4th clue). As the man finished the job he said the $1000 was his payment for the job. I got truly done.... Here's how.... The Web company was a franchise office. The rep was the franchisee. The cash payment... was tax minimization and possibly the franchise fee avoidance. The rep took his money and ran, leaving the roof man to finish the job. PS small segments on roof were missed, which finished off myself. No chance of getting anyone back for this. Done like dead dingos donger..
Phil, I hope you're still making videos and involved in real estate investing. I am so grateful that I came across your channel when I was Googling a question about contractor fees and how they set them. I was relieved to know that we didn't accidentally hire a bad apple contractor -- they practically ALL ARE. And when he revealed to us that he has a criminal record, I was not at all surprised. For years I've been around in-laws, neighbors, workers, employees and contractors who were alcoholic / drug addicts / convicts / codependent / mentally ill / struggling financially. I started wondering why we were attracting that negative energy -- but it's everywhere you look!!!! So for this video alone, I love your fire. Thank you. I actually had a cynical but eye-opening laugh when you mentioned Tennessee. The contractors so far show up between 10 and 11 and leave by 2:30 or 3:00. And even though the contract says "balance due at completion", they're always trying to ask for a draw. I love your idea that they'll start losing money once they pass the deadline. That makes all the sense in the world. So thank you, love.
Watch my entire playlist on working with contractors: ua-cam.com/play/PLcPfCvShc59tDh6dRQUncACahekX9VLrg.html Most contractors will screw you if they can. But armed with what I teach you on the subject, you can avoid getting screwed.
@@fightswithspirits915 19 months sober. 1526 days clean. Got my license back, Bought a 1 ton work van and trailer. I made 100k this year. I put on 25lbs of muscle in the gym. Sounds good on paper but life just has a way of making bigger obstacles as we progress.
@@bradleybates8870 I hear Phil hammering away at contractors with less experience than I have. So, here is what I will say. I know there is WAY more consumers that are less trustworthy than contractors. Honest women and men owned contracting business that are always screws by the CONSUMER by a scale of magnitude.
As a home inspector, most of the houses that I look at that have been fixed up by investors, have been sub quality materials and methods, and usually just cosmetic to get the house sold. There has been great disgreguard to structural, electric or other life safety issues. in the spirit of this video, apparently they were out for a quick buck at the expense of an unsuspecting home buyer.
Definitely - Here's a great rule of thumb for buying a house: Never buy a house from a home flipper or you'll be re doing their work in less than a year.
I know an Armenian guy who's been building high end houses. The houses cosmetically look beautiful but he hires the cheapest subs for the critical items like HVAC and plumbing. A family friend bought his first house and she had to have some of the plumbing and heating redone because it was so bad. The master shower leaked, a separate leak from rain warped part of her first floor, she had to replace the roof shingles, and some of the outdoor stone work was sinking.
Real estate investors are typically *extremely cheap - good contractors are fully aware of this fact. Seldom will a good contractor waste time on a bid with an "investor," because they are often much like Phil is presenting himself in this video. Cheap, controlling, and a bit disrespectful to be honest. They treat tradespeople like they aren't worth a dime, and they *always hire the cheapest bidder - which is usually a criminal. Thus, no wonder they think all contractors are criminals - all they are willing to pay for is a criminal, so of course they're only ever going to have criminals working on their properties. Thus, their properties will always be subpar.
@@manleybeasley9114 you are exactly hitting the nail on the head. Any good contractor would not even give this guy a bid. When you go for the cheapest you get the cheapest in all respects.
@@jestevanes34 You already get paid for your labor, you're not doing anything for free. Any contractor that won't allow me to provide the materials or refuses to provide me with the receipts for the materials is a contractor I dump. I can understand adding on a reasonable fee for the pickup and transport of materials but anything over and above that is dishonest thievery.
@@Son37Lumiere Then what customers must do is educate themselves on the types of contracts (pros and cons) they want to sign with their GCs. At my family's company we use 4 types and make sure to explain them to our clients as to avoid any difficulties during and after the time of project completion.
You have to decide if it’s worth it for you in terms of your time. There are times I happily pay for the mark-up in order to not have to run around doing the shopping.
I am a women 5'1". During one of the custom homes I designed and built as an owner builder I noticed that the framers looked increasingly unhappy. I asked them what the matter is. They said they haven't gotten paid in two weeks by the framing contractor. I told them that I will fire the sub and asked them if they would stay on to work for me. They tore the contractors sign down and went to work for me after I paid them. We built an awesome house in excellent time that made the local paper on two pages. Also - I never pay the subs anything upfront because I buy the material. Labor only does not require any upfront pay. One of the contractors took offense with that. I explained to him that no one who is hired after four years of college will get an upfront payment for coming to work. Also - make sure they sign a contract stating that they will work 8 hours every day until the job is done. Otherwise they will show up for two hours only. Require the subcontractor to stop by every day for in person communication. Make sure to tell everybody not to smoke (including chewing tobacco and spitting!), do drugs or drink and don't come to work overhang. They also need to clean up every day in a reasonable manner. Keep an eye on the crew of a subcontractor. I noticed very abusive conditions for the crew and all kinds of mistreatment by the subcontractors. Often they hire illegal immigrants or people on probation that don't dare to complain. Ask the crew members if they are treated and paid fairly. On my site there is mandated respect and dignity for all. To add - I always take pictures and make videos, am on site everyday and promise and write great reviews and recommendations for those who did a good job. That cuts down a lot on all problems and motivates them all.
this video is hilarious. we did a whole home renovation in 2013 & my wife & I were totally ignorant. I got a real estate license during the renovation process just to learn something & have some base of information to work with. literally going down this list that phil outlines we did every single thing on it. & at the end of the job my wife sued about 7 people involved with the job & luckily won in mediation a year after the lawsuit was formally served. in our case we got lucky because we did things so horribly wrong that the architect & contractor started getting lazy about their con game which enabled us to win the lawsuit easily albeit for 1/2 of the amount we sued for ($300,000 vs $650,000) however it was still a good win.
Are there any good contractors ??? I hear thisall the time from experience cash buyers that their biggest problem is to get a contractor to renovate what they buy it makes me so afraid to ever try to do a flip because nobody wants to do the work
@@uneedmorepeople The problem with flips is the budget is so tight , and supplies have gone thru the roof ! And the pay margin for quality reliable installers has dropped because if that ,, not the investors faut and not the contractors fault something's got to give.
@@uneedmorepeople yes, there are loads of great and honorable contractors. You can find examples of them here on youtube. Quality costs, though. Matt risinger, essential craftsman, kirk giradano and loads more. There are some local to you, I'm sure. If you're more concerned about cost than quality, you'll have problematic contractor experiences.
Why did she sue ? Did you have contractors that didn't complete work cheat you on materials. Because there's just as many people that screw over contractors i.e. have work done then sue for no reason besides scamming labor and materials from contractors.
So what's the mark up on realestate investing? Tell me, who deals with problems with the materials you purchase? How do they get to the job site? 2hat happens to the time frame when the job is at a standstill because you screwed up the materials list? As a painter, I seldom let the client purchase material, and if I do, I charge more for the headaches and lost time Im going to encounter. I also make them sign a waiver, I do not guarantee my work, when I am using a 5 dollar can of paint you got at Dollar General.
My paint comes from Sherwin Williams and I buy the best materials. I haven't made mistakes in years. I'm more detailed and organized than any other contractor I have ever worked with.
Phil Pustejovsky Your the exception then, sounds like you would be the guy I'd want to work for. I have worked for a lot of people, professional and private, and trust me, most don't have a clue. I still work on the side, and if I run into a difficult client, I'm sending them to your channel.
@@cre8tivplace222 Use one of the paints recommended by Consumers Reports. If you don't want to subscribe, most public libraries will have the most recent issue containing paint reviews. They extensively test/torture the paint to determine its durability, coverage and other factors. Sherwin Williams, just like all the other paint manufacturers, have more than one grade if paint and some are better than others. No idea if SW has a grade check marked by Consumers Union.
@@cre8tivplace222 I dont know what kind of paint you were trying to buy at sherwin but I dont even pay a 3rd of that lol and go there every day almost and it's good paint
Just because your paint comes from SW doesn't mean much. If you're buying the crappy contactor grade paint, it's still crap. If you're saying that you haven't made mistakes in years then you're either god or you're full of shit. I'm going to bet on the 2nd option. If you want to get rid of shitty contractors, just stop hiring them... It's not that hard to find good ones. If you're more detailed than any other contractor that you have ever worked for, you need to hire better ones, man.
ANYONE that tells you they can start in a week, or tomorrow..pass on them!! REAL contractors ALWAYS have a back log of work..I used to keep five crews of five guys working year round always! I sold the jobs, and designed them and my men did the work. We were never short of work to do. Just a thought is all.
I appreciate that you get heated over someone trying to take advantage of others. It shows that you care, and the world needs more people who care about not letting other take advantage of others. Thank you!
This video has been around a while but wow... Thank you! I am a Bigger Pockets fan but you, Phil are a "Matter of Fact" type! No Bs! I Like This! I am a new investor but have already learned that this is F'D UP and a shady world. I never thought the "Street Me" had to come out in legit business but wow. Thank you, Phil! You have a new fan! Wish I had a mentor like you! Will look for updated video.
Well spoken! Dealing with Contractors is oftentimes a street fight. Watch every video in my playlist on Working with Contractors: ua-cam.com/play/PLcPfCvShc59tDh6dRQUncACahekX9VLrg.html
Phil I love your passion about this topic. I have a construction business as well and our strategy is exactly what you said, if we're the only one bidding the job we always bid it higher. Great reminders here
Unfortunately, I agree with many of the things you say. I am a GC in Texas. I really wish the state would license contractors here. The MEP's and Irrigation contractors are licensed, but not the GC's. Way too many guys with a card and a truck say they are contractors. There are a lot of things you advise that I will not adhere to. 88% of my business is from existing clients. I have those clients because I provide excellent service, care about the client's wallet, am on my job sites daily, pay my subs when they want to be paid, but don't over pay my subs if they want paid for more than they are due. I mark up materials on every job that I provide the materials for. I also let the homeowner pay for materials if they want to, If the homeowner buys the materials, THEY are responsible for ordering it, arranging for them to be delivered to the site, making sure they are protected on the site, they are also responsible for making sure none of the materials (ie: plumbing fixtures, lighting, flooring, tile, windows, etc) are the quantities ordered, the color ordered, not scratched, chipped or broken in any way. Making sure all the parts are there for items like plumbing fixtures, making sure the fixtures are not damaged in any way, etc. ) the homeowner is also responsible for the WARRANTY of the materials, since THEY own them. If something has been installed, and is found to be defective, then the homeowner is responsible to pay me to remove the item, and replace it after the homeowner has returned it for a new one. The homeowner saves 20% of the cost of the materials that way. Some choose to do so, most do not. Most see the value in what I do when I purchase the materials.
Isn't it part of your responsibility as the GC to ensure the materials are installed correctly and working regardless of who purchases the materials? That is a large part of what you are being paid for is it not? You are essentially padding your pay by tacking on an additional inflated cost for materials over and above your labor rate. I mean, it sounds like you deserve less pay in that situation, as you are certainly doing less.
That’s a very good point. The only materials I buy is the actual appliances like picking my own replacement faucets, light fixtures of my delight, my own paint, the style of door and window replacement. I also realize the contractor gets a 20% discount on materials. I can always check estimate costs of the materials.
Thanks for your advice. When I told a contractor I wasn't in a hurry to have a bathroom and living built-ins built, it took months to finish. The cabinetry took 2-3 days not including painting. The bathroom took a 2 1/2 months And it wasn't the electrician or plumbers fault. We never had to wait for them. Who takes that long to remodel a 7' x 9' bathroom? So I agree. Never tell a contractor you are not in a hurry. Also, I hate when I type a list of the work I want done and the contractor won't take it. They always leave things off the written quote.
I love that about criminal backgrounds, "...that doesn't mean that they are a bad person, there's plenty of WONDERFUL criminals..." so true. Forgive and forget? Not when it comes to business. Work with moral people.
The same goes for the customers. ( there are some bad apples there too)It's human nature. That's why low bidder usually equals a nightmare for the homeowners they don't know the difference from quality labor and quality products.
I agree with you on everything except on it's human nature. I don't think it's natural for humans to be evil, cheat and scam everyone around them. But I know people do. I wish we could figure out why they do. I wish we could fix them. I think it's a sickness that we should be looking for a cure.
I'm a contractor and your 100% right phill, being in the field I notice their actions are not always ethical, specially the plumbers and electricians, great video.
This was so helpful. Thankyou so much Phil . My husband just died a month ago and i found out my roof is leaking. There's a 4 by 4 brown spot on my ceiling. It was just 2 by 2 and i thought it was just dirt maybe from my airconditioner vent. But this morning after a 3 day nonstop rain, it grew over night so i have to hurry on this. So i will do what you say about hiring contractors.Take care Phil . Your a good man. Carrie
One thing he should have mentioned ... stay on top of the project ... don’t be a pain in the ass, but DO check the progress and ask questions if you think something is not going as planned or agreed upon.
Thank you for being just as pissed off about dealing with contractors as me. I live in a small town and have had absolute hell with just trying to get simple work done around my house. 100% agree with this entire video.
Spot on! Just because you're paranoid doesn't mean they're not out to get you. Lastly, I always call the insurer to verify coverage directly. How many contractors obtain the insurance and then cancel after they have the documentation?
Every successful real estate investor has a mentor. Get your mentor here: www.freedommentor.com/apprentice
How do you get tuff with your GC?
I expect a logical response, countering my replies to @bobvogel6844
I've been a licensed and bonded independent residential remodeling contractor for over twenty-five years now and can vouch for every single one of these from the devil's side, lol, having experienced the pain that comes from not adhering to these rules both as a contractor and a home owner. Kudos for an excellent video.
You're also poor and probably complain about taxation. This is all poor people scarcity stuff. U get what you pay for. Not working for free or cheap. A guy at NASA made 1,000 for tightening a bolt? I the best thing about the best country in the world is that we are still free to charge whatever as ridiculous as if sounds. And I I'm good at it you bet I'm gonna hold you hostage. Pay up or git. That simple. And then the buyer becomes enraged when I refuse to accept the price that they value me at. Seriously? How about I come to your job, perform an inch-by-inch analysis of everything you actually do, and then reassess your value as a human? I'll come to your corporate office or hospital where you work. When I catch you texting your moron associates or looking at photos I'll assume you do this daily. I'll count all your time wasting and formulate an average n of hours you waste and then I'll find other relevant variables in your line of duty and Ultimately decide that I can automate your job, pay you minimum, and keep you as a part timer.
In your case, I'll count All the time you waste at Ace hardware looking at tools and supplies and products that are completely irrelevant to the project at hand. Tell me I'm lying I'm an administrator, entrepreneur, market and most recently--builder. Because the morons I was employing at age 17 thought I was only capable of hitting keys and scheduling jobs. Turns out I can work faster and smarter on the computer AND with a drill.
I wanna see this guy pushing a wheel barrow for an hour. Let me put you both to work and remind you where you came from. Maybe he didn't come from where we or I came from. I might as well be from Tijuana or Africa.
Oh and Im a real estate advisor...same thing. No one understands the hard work involved. Both trades need to.....trade for a week and then go talk smack about one another.
Just move to Florida and somebody told me if the contractor is using subcontractors, get a release of lien before you pay them
This is huge of you. I literally only trust contractors I have a friendship with, or develop a relationship with them during the work.
Easy do the work by yourself...
wish we could do that here in California@@rockn997
I’m a foreman for a contractor,
This guy is telling the truth, and honestly I’ve seen even worse,
I actually have wanted to start my own company just because I’ve witnessed so much and I know I could make a ton of money just by being honest.
This guy is credible
Rule #8 Never Ever Ever Let the Money get Ahead of the Work. Period.
Well, then this guy would not work for you. I'm NOT financing YOUR project. Period!
@[The] White Rabbit pretty common practice to get 50% down payment to start work moron.
Stupidest thing ever. A contractor it is not a financial institution.
Not in states but no one would work for your project if they have to spend it out of their pocket
PERIOD!!!🤯🤪
Another reason why people just let their home repairs go undone. Too much stress and anxiety trying to find an honorable contractor that will do the work correctly, at a reasonable cost, without ripping you off!
it's true
I’m one of them
This!
I'm a contractor just starting out that has worked for years for a very honest contractor. your video has given me a few tips on how to continue to do honest labor, because our marketing has mostly been word of mouth and usually that word is "they're honest". I want to keep this reputation while starting out on my own and your video has given me tips on staying that way. I was irked, to be honest, because 99% percent of these "scams" we have never done, and the ones we have were not out of ill intent or was offered by the customer. And yes i am offended by many of your "they" statements but at the same time I see the others that we have to come in and finish the job behind. so as crass as your video is, your video has helped me to stay and honest contractor. thank you.
If there is a single point to take away from this...educate yourself.
Never assume, and get everything in writing.
Art Houston exactly
assume yup. ass of U and me
Art Houston Adk that to a woman you moron
And insist on seeing actual samples. My sider sent me to other homes he had done to see materials used and then turned around and used different materials on mine!
I was a contractor for almost 50 years and I wish my customers had seen your video. The contract works both ways and I can only guess at what some of my customers must have been imagining. BTW I never advertised my services, it was all word of mouth - be square with people and you'll never lack for work.
I'm curious, do you have a few things that customers should never do to a contractor?
@@stephenshelton4267 in general, be honest. If the contractor isn't working out figure out what he is owed, pay him and move on.
@@ktajax
mmm
You identified the biggest problem. Homeowners have a habit of imagining that contractors can read minds. Make a detailed list of your requirements and make it part of the contract.
@@facehairteeth That's a good idea but they still quite frequently screw it up. The upside is that if you have everything in writing they either have to correct the problem on their dime or you can fire them and they really don't have a leg to stand on to sue you for any work not done to spec. So you just pay them for what they did correctly and tell them to hit the road on the rest. Most of the time though they are honest enough to just fix the problem in large part because they know their guy screwed up and they don't want a small problem to become a big PR nightmare.
"I'm not in a hurry." Yes, I made that mistake years ago. Hired a guy end of August and gave him a down payment. He showed up in the middle of October, and only after I psycho-called him, from different phones since he stopped answering when he saw my home number. Live and learn.
J FF lol
That’s horrible!!!!
They made it to the job on 6 weeks? That’s fast!
I mean he should’ve been clear about the timeframe from the start, so that you weren’t expecting him to start right away, but if you hired him in August, starting in October is REMARKABLY fast, especially right now. Right now, the company I work for (kitchen & bathroom renos) is booked out for months, we’re currently taking deposits for jobs that’ll start in like July-August of next year. The fact that you got a guy out there in less than 2 months is remarkable
@@Dreadlock1227 I don't think he would have come back at all had I not called him from different numbers. He lied to me, and then he did 3/4 of the job, threw down his shovel and departed, never to be seen again. By then I was too tired of it all to pursue him.
I greatly appreciate your enthusiasm for proper dealings with Contractors. All of your points are well taken, and says a lot about your experience. Thousands of people would be better off if they heeded your advice. Trust no one. Get educated, learn, If we all did this properly, many contractors would accept the fact that they need to be more honest. You have armed us with great principles dealing with contractors. I know you have saved many people a great deal of financial losses, fustration and poor workmanship. Thank you Phil.
I find that interesting. He sounds like a roided out gym bro, I got about 3/4 of the way through and just couldn't take his tone and attitude anymore.
I am a contractor, and I don't walk on water, sometimes things just do not go as planed.
One thing I will say is the people who are the angriest at me all fall into one category, and that is the people i won't work for.
Someone will get a good recommendation from a previous client of mine. They will call me to come over and give them an estimate. If I sense any attitude like Phil's or if they lack normal sense of fair play or flexibility, i just tell them I am not interested and thank them for their time, and go stright for the door.
A good contractor dosen't need work, what they are looking for is reasonable people who have a sense of fairness. When I go for an estimate the main thing I am doing is evaluating the client to see how they might react if something dosen't go right, and trust me even the very best contractors run into problems.
Go ask Apple for a cost breakdown to build their phones. lol good luck
You are the slickster that he speaks of in this video.
I agree with this. Renovations in particular are just not predictable. People like Phil are true con artists.
As a contractor, if it starts off bad with a customer, it only gets worse.. Run from this guy! We are always fair and reasonable with our customers
I'm a remodeling contractor. I hear a lot of horror stories like this. I know there is something being left out of the story. That something is they hired the cheapest bidder or the first person who agreed to come out. Take the time to develop a relationship with an honest contractor like me. Don't be in such a huge now, now, now rush that you can't wait for your regular honest contractor to get an opening in his schedule to get to your project. Don't expect people to work for free.
yeah all those jerks were cheapskates
dont bid what you cant do lot of people put up a front to get that job they havent had a job that big before and are winging it
out of 5 guys i hired to admin my server the lowballers cost me $1000.00
and 6 months aggrivation the $125.00 hr guy fixed all there screw ups and got my never gonna happen wish list done in under 30 min
Called 70 contractors...70 for a remodel job on a vacant house. They either didn't call back, didn't show up, or had excuses as to why they couldn't show up.
Absolutely! cheap bidders.
@@PK-fp8ie Correct. These "flippers" want it cheap and quick.
I'm a first time homeowner and are looking to complete a few projects this year. Thank you for sharing your insight. I'm always worried of getting ripped off.
Don't let them use your bathroom; they plugged mine!
@@micheleemcdaniel389 guess they'll be digging a hole in the backyard.
@@jennifurzoe1302 Or rent a port-a-potty. In hindsight that's what I would have done as it was a two month job and for number ones he just went to the back of the yard and let fly. Disgusting!
Be very worried. It's fatal attraction for real. I don't want to sound negative, but it's almost going to happen at some point. You just have to minimize the amount of times it will happen. You're one person with a small budget. Imagine how much companies lose annually from employees they hire, train, and educate only to be abandoned, stolen from, lied to, and misrepresented. They just have more resources to take the repeated hits. We don't.
Quote of the day, "There's plenty of wonderful criminals." LOL, thanks for all the tips, very appreciated!
That made me laugh too!!
So what I got from this is:
1. 3 bids minimum (make them compete)
2. verify materials and labor costs are justified
3. only pay upfront costs that make sense but never over 20% project cost
4. Tell the contractor you expect it done in a timely matter or simply put industry standard.
5. I choose materials while also taking advice consideration from experts.
6. Always check and see who is doing the work.
7. If its not in the contract it either better be before the project starts or I aint paying it.
Thank you - that saved me from wasting 20 minutes on this verbose shouting rant
make them compete.... this is when they cut corners and skimp with lower quality materials
Great points Phil! I would add as a contractor, never tell your contractor that you aren't or don't want to get permits for your renovation. You will get a cheaper quote but it won't be to code and it will be rushed, poor quality work that is more likely to fail.
ALL true!! Especially today, I've found most contractors when they have realized that they cannot rip you off, they would rather not take the job.
Or from a contractors perspective when they find out you are cheap and don't want to pay them a fair price would rather not take the job.
Jonathan DeWitt , thank you. A good honest contractor would never put up with this tool. Cheap-ass Realtors attract the shady contractors.
Wow It's is truly sad how easily contractors rip people off with a straight face, I know 2 brothers who has been in the business for approximately 30 years and about a week ago I asked the one a question about contractors and was disappointed to hear that he mentioned that they are all a bunch of thieves, all of them. This was truly disappointing to hear, I believe them because I have known them for quite some time now. I do also believe that not all contractors can be this evil, but the honest ones are not easy to find, this has to be true.
I'm a small business residential contractor and I approve this message.
Ok thanks
I got the joke lol
You want the customers picking out materials? Thats insane for me an electrical contractor, no way I want the customer picking materials, even if I make no money on it. They pick out the wrong/inferior stuff
I agree with everything you have said. Specially get every
detail in writing.
You can tell right off the bat if a contractor doesn’t want
to give a detailed list of “everything”.
They are trying to rip you off. As far as estimates go, get
a dozen!
You really need to do your home work about proper workmanship
for the application and the right building materials.
Contractors don’t like when you point out building materials
that have to be installed in a certain way or warranty will be void for that
product.
The last line in my contracts states” process will be videotaped”.
If that doesn’t scare off the crooks nothing will!
The great ones will ask for a copy of that tape to use for
promoting their business.
Don’t just hand it over, bargain with it, it was your time
and effort.
Their times worth money and so is yours.
This is SUCH good info. I'm sure the issues are magnified at the commercial and higher-dollar residential level, but even on small household jobs like fencing and irrigating and painting there is something to be learned.
Ironically, points 2,3,5, and 7 are also frequent ways that unscrupulous homeowners screw well-intentioned contractors. A reputable contractor will always design a contract that protects contractor and client. He will set his own parameters for timely completion and detail what he must complete before each draw, and leave little for the client to necessarily negotiate.
Material cost is a touchy subject. A reputable contractor will protect himself with a reasonable mark-up or contingency, especially with "prospect" clients...that is, the ones who "aren't in a hurry" or "just want to see what it costs first." People who knee-jerk select the lowest bid from someone who didn't properly cushion their estimate frequently find themselves with a contractor who nags for more money or walks off with the job unfinished. How much are you saving after you pay the contractor you should have selected the first time to redo and finish what Discount Daryl and Slip-shot Sam walked off and left?
44fastgun Hopkins you get what you pay for.
Agreed is this guy even a fucking contractor??? If the materials are 550... and they are charging you 850 its because of material procurement costs, deliveries, labor to gather said materials and time spend getting materials. This guy is a clown
Mi respect for you
@@danch10 300 more dollars to make a 5 minute call or email to buy materials???
well said
I have fixed and flipped over 20 properties and here are some of my the best ways I have found contractors.
Ask other contractors - they pay attention to each others work and they know who does quality work.
Home Depot - Call me crazy but I sit at home depot and eat a hot dog and look for the following:
1. Contractor with truck - Small projects you don't need a GC unless you a beginner.
2. The way they carry themselves. A man that cares about his appearance will usually care about his work.
3. Mannerisms - Does he appear to be organized? Is his truck a mess? Does he talk over you?
4. Beware of contractors who can do everything. When they say I can do everything, I reply with if you had to choose one specialty what would it be.
My favorite way to hire a contractor is to stop by when I see guys working and look at their work. Sometimes they will refer you to their boss and I reply with I am looking for guys who want to do some side work.
Think about it, why pay the boss when he is not the one doing the work.
How to pay contractor?
Be safe and smart - Pay for material up front only!
Weekly pay based on line items completed. Contractors have families and need to eat. Be fair!
Never pay early unless you built trust with your contractor because this is a easy way to get screwed.
Offer incentive if he finishes before deadline! Why not you both win and he will be eager to work your next project.
Request invoices, pictures and video weekly before payment. They create your timeline for you by the week.
If something not complete or you have a disagreement you have proof that they created.
Penalty for for not finishing on time. $100 per day for each day past agreed upon completion date.
Invoices should be so detailed that it includes door knobs.
Penalty for for not finishing on time. $100 per day for each day past agreed upon completion date.
Creative Home Buys Good advice. Thanks.
🌲🌝☘️
Wonderful tips! Thanks for taking the time and write them down! 🙏
"WHY PAY THE BOSS" I like that, in other words you think you are smart right??? WRONG, because the boss owns the company that gives you a warranty on that job, the Boss is the one speaking English so you wont get frustrated trying to get your point across, good luck trying to get those workers back to do a touch up, because they will be busy with the work the
Boss gives them, and you will be waiting long time , AND MOST IMPORTANTLY IF SOMETHING BAD HAPPENS (AND I WISH IT DOES, SO YOU LEARN A LESSON) , WHICH INSURANCE ARE YOU GONNA MAKE A CLAIM ON ???? In other words : YOU ARE AN IDIOT
VERY BAD ADVISE ON ONE PART = The boss is the one who carries the insurance! Not to mention, that's called moonlighting and most employees sign an employment agreement stating that it is illegal for them to moonlight. Also, here in South Dakota that is also soliciting and you can be charged a crime for trying to convince my employees to perform work on the side that is unregulated, uninsured, and performed without a permit. Because the boss is the one who can pull a permit.
For the ladies, in my experience as a woman, the most critical thing I do is educate myself. I not only read reviews and ask neighbors about quality contractors (Google, Nextdoor, etc), I also educate myself on the details of the project. When I do that, I can have an intelligent conversation with the contractor by understanding the language and realistic scope of the project.
SOME contractors will assume being female, you are not knowledgeable and will attempt to financially take advantage of you. If you are able to ask specific questions (and comprehend), you can avoid a lot of headaches. And sometimes you realize you're actually smart enough to install that toilet yourself! 💪🚽😁
I'll also add that I haven't had a bad experience with any contractor I used, and I feel certain it's because I invested the time to research who is doing the work and how to accomplish the final product. Good luck on your future endeavors!
🔥
I'm too agreeable and trusting and have to guard against that. Research and preparation do make all the difference!
Thank you so much, I feel more confident now, i am dealing with contractors first time.
I believe it's something within me that I continously get screwed by these contractors. I did my research and asked all the questions and hired a contractors that I feel comfortable to do the and the work ended up sloppy the refused to fix minor things because they already passed the inspection😫😫
As a single female, living alone, the tricky thing for me has been that if I do research to try to be knowledgeable enough to simply explain the issue, it seems to put some men off. Even if it’s something really simple.
The last time I called someone from my heating company I said to the guy, “Last time I had this issue with my boiler it was because the pressuretrol pigtail was clogged with sludge, which led to other problems.” He then had me run the shower with the hot water on and proceeded to explain to me that water, when hot, will make steam. 🤪
My radiators were going off heat in the summer whenever the boiler kicked on when I showered. The heat was off. It was 90 outside. He left and the next day I had to call the company back and request a different technician.
In the future I’ll find some costume wedding ring and say “We” and maybe rent a fake husband for the day.
And this was just an inconvenience lol. I’ve grown much smarter with actual contractor situations, but still always feel like I’m probably being “pink taxed.”
As a contractor myself I agree with most of Phil's points except I will not do certain jobs with customer supplied materials. Yes, if you haggle with a supplier they will discount for bulk orders but you better believe they're going to go out of their way to get rid of the worst materials they have on the shelves. They generally wont do that with us because we deal with them daily.
I get all my work from referrals and I feel that is the best way to find a contractor but ALWAYS do your research if you've never used them before!
i do light plumbing work now and then for investors...faucets. toilets etc.. they always want me to buy the cheap home depot glacier bay junk and i say ok but not gonna warranty anything..3 months later i am back fixing a leak and charging them a service call which is usually double what the good moen or delta product would have cost in the first place.
I disagree. Material Suppliers aren't nearly as loyal to contractors as contractors may think (or try to convince clients). I can walk into any supplier and get a contractor's account set up with them quickly and get the same discount as a contractor. But contractors are pros at convincing people that they can get a better discount than us non-contractors can. In the real world, I have seen where it is simply not true. Plus, material suppliers really like me because I always pay on time and/or upfront; unlike some contractors that fall behind on paying their materials tab
Phil Pustejovsky I think what Bucko is saying that he frequents the supplier much more than someone flipping 3 homes a year(not you, your audience), hence has a more personal relationship .
JDub Exactly! I've seen it many times and been burned by it myself, hence why I wont do it. Just turns into a huge headache on bigger jobs.
What you're saying Phil is that your relationship with supply houses is better than the contractors, because of your longevity with them, and you pay cash up front. Makes sense, of course. Nothing wrong with that. Why not mentor contractors as well? Shitty contractors are everywhere. They need a course too. I think what I'm getting at is that stop bashing us low-lifes that can't do biz 101 and turn us into super-stars for rehabs! LOL! Just a thought man!
This happened to my boyfriend. He gave a contractor $2000 up front to get started on a job fixing old doors in our house and we never could get ahold of him again. He took the money and disappeared. At first when i found out boyfriend gave the guy money i though “oh Jeez” i would never do that, but my boyfriend is such an honest person, he is clueless about how some people can be.
So true, mom paid whole to a contractor and he left to Nicaragua without doing the job, worst thing was that he's also family 😒
Great video! The amount of problems I have had with contractors; just rehabilitating one house, could fill a small book. Here’s one for you: Two identical Steele entry doors: one exterior, one interior, each with a different swing - one swings in right, the other swings in to the left - purchased in December from a big box store- not installed correctly until September of the next year: issues, wrong doors, door installed backwards (redone), one door of one type and color, one door of another type and color, wrong hardware packages, wrong Caming-color: black not Puter around the glass, wrong hardware color: mismatched Satin Nickel and one Black, changed sub contractors: three times, and so on. It took a complaint to the Attorney General of Connecticut to get five contractors on my porch and the job finished correctly; the same day; nine months later 😳: No BS! One door still has a quarter inch gap on one side to this day incidentally. What a frickin nightmare! I used to refer to my house in those days as “The Nightmare on Noble Street.” This one issue with the doors set my schedule for total rehabilitation project(s) completion back by at least a year; @ least. I won’t even get into the stress and demotivating factors involved. It took about five situations like this one to change the way I deal with contractors and now each transaction is a lot smoother, but still fraught with risk!.
A Big thanks goes out to Richard Blumenthal and his staff for their help. The fact that I even needed to get the Attorney General’s help is the point; cautionary tales abound and people need to be educated about the risks of dealing with contractors; moreover, how to develop back up plans to work around problems that arise around the processes inherent in rehabilitation of properties.
After being screwed over a bunch, I wish I had had a mentor along the way; perhaps then I would have seen a video like this one to learn to know how to negotiate around the pitfalls in the contracting process. Now, I almost always exclusively contract with Brick&Mortar Business Owners who have a verifiable record of stellar performance, and a business location that is more than a pick-up truck! It costs a little more, but it’s worth it.
Also, substance abuse issues abound amongst this skilled labor group: I sometimes make a point to mention that my property is a Drug and Alcohol Free Zone: meaning there is a Zero Tolerance Policy that includes a clause that verifiable use of substances or intoxication on my property = non-payment! 12-Step Recovery Clubs can be a great place to find Clean and Sober Contractors looking for work by the way. There are many contractors out there who do amazing work that I couldn’t; when the contracting process goes well; smoothly - amazing property transformations can occur. My Nightmare on Noble Street is now a Cozy New England Cottage Beach House by the Sea... but achieving this state of transformation of the house from the former mess it was - was not easy; but, the lessons learned - are definitely invaluable!
Thank you Phil👍🏻.
RB/CT
As a plastering contractor i agree 100% with this guy , years ago an elderly couple hired a GC from their church to do a 20k job but charged them 59k i was hired to stucco two columns by the crooked GC I charged him 600 he charged home owner 3500 just for what i did homwoner asked me what i charged long story short i helped the old man getting GC charged with crime
Right? other day watched a youtube video where some sistas were twerking in church to the tune of ''oh happy day'' lol. i thought to myself man! this are the last days.
Youre a wanker then.
Asshat number 1 right here
sounds like a fake story
You should of been charging more.
No matter how much you know, there is always something that can be learned. Thanks.
Thank you, Phil! I have made most of these mistakes. Still have a contractor who did one job well so I gave him money up front for a second job and he skipped. Wish I had you to do my negotiating for me. Be safe and God bless.
As a single woman and business owner I can happily say I have always had good deals... because I stuck with all these rules all these years! Always at least 3-4 bids! It’s not just the price either. You want to pick someone you LIKE. I like buying my own materials (like faucets and bathroom cabinet) and getting a fair estimate up front for installation. Also, I want to see a nice folder of photos of previous jobs. Also, before hiring someone for a very big job, hire them for a small job and see how good it turns out. This will give you a preview of coming attractions. Ask a lot of questions, that way they are more careful not to rob a well informed client. If they out talk you or get arrogant or defensive, they will be hard to work with. Don’t be afraid to oversee the work. Some of these guys don’t have a lot going on in the Common Sense department. If they pull a no show, don’t bother calling them back. Chasing people to work is no way to do business. If they don’t respect your time or have integrity, don’t enable them because they will keep being that way. Make sure you get a Playbill of how the progress of work is to be done and always ask how long it takes to do it. Anyways, all these things matter when living in a world where finding the right contractor is like being a boss hiring an employee. What makes you the boss? Your wallet.
Very well said!
Worked with contractors on 2 home remodel projects. In my experience here is what they start with: " CASH " . They all ask for cash, even on bigger jobs 30k or more. Than you eliminate the cash folk and get " reputable " company where the person that gives the estimation does just that and is always nice, professional and knowledgeable but the workers they send on the job are cheap labor, lack experience, and I had to watch every step they take and waste time also because they cut corners.
Examples here: cut footing on the home instead of drilling, cut through supporting wall when placing ductwork, incorrectly placing/ sealing vents on the roof causing leaks in the bathroom, etc, etc.
I heard them brag about giving people ridiculously high estimates because they are so busy, and being surprised that home owners accepted.
NEVER pay cash unless it is simple service call. Your money should be traceable to prevent liens. ALWAYS get lien waivers from your contractors subs and vendors. You can get partials through a certain date of final unconditional at the end of the project.
Always pay checks if they want cash they can go to your bank.
..i am a contractor and a real estate investor..i gotta say for the most part i agree... always all kinds of variables though. those small quick jobs can turn into big ones real quick...i work in massachusetts where asbestos and lead paint can easily double the job cost.... by law we must have a written contract for any job over 1,000$ and can only take a max of one third up front.
Very valid points. Definitely get everything in writing, get before and after photos as well. This not only protects the consumer but it also protects the contractors as well. We try to educate our customers about the mistakes of going through those fly by night contractors and how to find someone or a company who will do a good job and who will stand by their work. Good Advice man! Keep it up!
even in writing, they don't care. prepare as if you are going to court will help though. they still don't care. even if you win, they will take off and never pay.
Being an older woman I have so much trouble looking for honest labor
You pretty much have to be able to do things yourself these days. The majority of people are retarded.
Get references from your friends.
@Nyree Harris careful, don't be so presumptuous that all contractors are men.
I agree with u, they are very predatory to women
@@timrich6755 that can back fire too, so check friends and a few more customers of the person. sometimes the friend gets good service and you get screwed
Rarely will you ever see Phil so animated, so urgent on a topic as this one. This is important information.
Phil reminds me of Saul (Better Call Saul)
Jeremy Smith 🤣🤣🤣🤣so true
I was just thinking that!!
I love Saul
Lol, yeah a snake oil salesman!
😂😂😂😂😂
Great job. Just want to add. Be there as much as possible. Almost every time I contract a job... a contractor find a "different" surprisingly easier or cheap way.
"There are many wonderful criminals" 😂😂
I'm glad you see that
@Toby Henderson I'll keep this in mind
That cracked me up when he said that. I wasn't sure if I heard him right. Apparently I did. LOL
I appreciate you making this video! There are not many people like you out there who tells the full truth regarding this stuff. Thank you brother, again I appreciate it.
12 Years in the Foreclosure/Preservation/Asset Management business- and everything is SO TRUE! Live and learn- but it's much better to KNOW and learn before you lose out on TONS! Thanks Phil!
I have been screwed over so many times by contractors I had contractors remove and replace drywall and just a few months later I got a call from my rental tenants that the drywall is starting to pop of the wall because they didn’t use screw they used nails
And also I had the contractors sand and re-stain the hardwood floors in my rental property and they left the floors bumpy and wave and a few parts of the floor had puddles of the clear coat that had hardened before they even smoothed it out and when I got back with them to fix the problems they made ,they said that had never restored floors whereas in there listening it said they did
Bay Whedon
Goes with the territory, when I hear rental property. Owners are usually gaming for the lowest bid, knowing full well the tenant won’t be gentle with their property.
Work hard to find contractors with integrity! Get referrals from good property managers and brokers, and always speak with references.
You're right. Even if you are shy, speak with references. My sider totally misrepresented himself.
@@micheleemcdaniel389 Sorry that happened to you!
I'm cringing as I watched this. I hired an electrician to upgrade main box and add a switch in a bathroom. I didn't get paper estimate. I never got a receipt for work. I had to keep calling him back to finish. I think I got ripped off. I'm actually glad he didn't do the long list I wanted.
Put a hex on him. That is, if you know what you're doing. And I'm being serious.
@@sethlogan9724 karma has a way of getting even
@@CandycaneBeyond Wrong. Karma was derived from cause and effect. Later adopted by idiotic high priests to control the masses by fear. Nothing more than man made.
Take care. :)
Check and see if your state requires electricians to be licensed (it could be per city or county also). The licensing in Texas is through the state.
By Texas state law he is required to give you an invoice for payment. If its in city limits then a service change requires a city permit followed by an inspection. The invoice must have all of his information on it including license number and the 1-800 number for the State. the state even has a search on the website so that you can make sure he is insured and in good standing.
@@CandycaneBeyond God sees all...
I work for a GC who absolutely prides himself on being crystal clear and keeping everything on the up n up. If i ever acted anything like the contractors you seem to work with, my ass would be in the unemployment line faster than anything.
The only even remotely shady thing we do is that if we're doing a trash haul from old tennants, we'll take any cool things we find.
@SomeDumUsrName because most contractors are “shady characters.”
LMAO! I'm loving your passion Phil!!!! I'm just Realtor right now but I'm working towards becoming an investor. The NO BULLSHIT lessons like this one are GREATLY appreciated and I'm very much looking forward to learning more from you ; )
Yeah l heard you man , l just start doing on my own as a small Drywall finishing company and l had been doing some side jobs ,but l always get pay till my job is done l will wait till the owner check my job and approved,.
You are absolutely right about book keepers stealing money, and it's always people you'd swear beforehand would never do it.
-Ken
Happened to my relative, he basically made his accountant rich because he trusted him while he himself couldn't figure out why his company had all this business but he wasn't making any money. Never ever trust people with your company finances, you will be stolen from.
Excellent video, looking forward when buying my next new home to be able to keep one step in front of the builder's run around and being able to figure out if he is BS ing me.
The comment about the bookkeepers stealing money is hilarious. But it does remind me of something my mother told me once and that is NEVER give someone else control over your money. As soon as you do you'll get screwed.
Yes, my Dad was screwed by his bookkeeper !
I like the content and the intensity is also entertaining
He has several ways of expressing disapproval. I especially liked how @13:59 he crossed his arms and made a "wrong answer" noise.
Follow up video should be "How to find a good contractor"
Well, of course! Here is that one: ua-cam.com/video/xrlP-LD8NC8/v-deo.html
This guy’s a freaking joke
@@frednot809 why?
I used to be a contractor and I found out there were customers that were very slow or delinquent with payments. No matter how well I worked for them.
For every dud out there, there is multiple good honest contractors out there .
Non the less be careful for the duds , you usually can spot them before a job starts with some effort .
For every bad contractor,10 unreasonable home owner
NO NO NO NO...If you think it's a one-for-one trade off, you need to tune in to EARTH. Far more low character than high character. If what you said were true, it would be a breeze to find a moral contractor with integrity--it AIN'T.
Watch out if they ask for a lot of money up front. That is a red flag!
Its actually pretty easy. View their work, call their references, read their reviews. Not difficult at all for anyone older than 10.
I wish my daughter had seeing this video before she got screwed royaly by this contractor. I'm definitely will follow your advice for future projects. thanks for sharing this video.
Phil, I really appreciate your taking the time and energy and thought that you put into the making of this video. It is obvious that you are experienced in REI, and this is VERY HELPFUL to us newbies. Thanks Again
Please don’t lump me into the unethical contractor group.
There are plenty of good contractors.
I agree to having a signed contract by both, the homeowner & the contractor, before work starts
He didn't lump you into his video but you did. He was talking about the pitfalls of bad contractors I have to ask why did you think that was you.
Usually it is the upstarts that can't be trusted, most established Contractors have to be honest. We charge higher rates but are always swamped with business.
warren thomas yes he did lump ALL contractors together. As an honest contractor, I’d never work for this tool. Many, but not all realtors are cheap-crooked to their contractors.
@@FrankRomanyshyn What state are you in?
@@warrenthomas1253 Actually, he did lump @Chad and every other legitimate contractor in with the bad. He never states that there are legitimate contractors, performing their duties in a professional and ethical manner. Instead, he makes it clear that contractors "usually can't look past Friday afternoon" as if to say there are no contractors operating their businesses professionally with adequate margins to sustain their organization beyond a week. While I love his enthusiasm and his clear contribution to educating the general public regarding topics surrounding real estate; his personal experiences (or should I say choices) have led him to make generalizations that are not fair and inaccurate. You know..... He comes off as the scorned wife who wants to lump all men in as dogs because of her bad choices in picking men. This guy is clearly looking for the cheapest deal he can find, and then complains when he doesn't get top notch service. The two (cheapest deal & top-notch service) hardly ever go hand-in-hand.
I am both a real estate investor an contractor and I agreed with most of what you said. Like you said, as a real estate investor it's better for you to buy the materials directly. If they are going to supply materials they will give you a flat price, I don't think it's necessary to brake down materials and labor. One thing as a contractor that I learned is that if you don't ask for something down a lot of people will waste your time or change their mind. A down payment forces them to commit to hiring you for the whole project. You have to watch what you say because a lot of course tractors expect some level of trust and you don't want to insulting them. But yes, contractors are notorious for screwing people.
Well spoken. Clients needs to have skin in the game or they will string out contractors. If I was a contractor, I would demand a deposit. I always pay my contractors deposits.
A lawyer informed me that one of the main tenets of a contract is "There is no contract without consideration" AKA $$$ Pd. That's why I always get a deposit or don't do the job. Then too If there is going to be a deadbeat it will be the guy balking on the deposit. I know someone in the jewelry Bus.They do business on a handshake or a memo signed on tens of thousands of dollars. I wont trust the public on 5 Hundred.
Anonymous so u say u do this to ur customers.
I had my first custom home built when I was 22 years old. And I expected honesty and good faith. Got rid of that idea really fast. I also pay for an ON SITE CONSTRUCTION MGR who verifies the deliveries, materials, quantity and type. He also verifies the hours of each employee I am paying for - clock in and clock out times. My ON SITE MGR is also responsible for security, locking up, opening up, keeping the insurance paid, keeping the alarm systems up and running, etc. I pay the guy well. Very well. But it eliminates cheating an using purloined materials. In my 2nd house we had a full indoor kitchen, and coffee /breakfast prep areas in the MBR, and the pool house, and in a guest suite. Each of those got a 2 burner Miele Induction Cooktop installed. One of the subs tried to substitute an unknown brand of dual burner induction cook top. I caught it and found out the cook tops he was trying to install were stolen out of a wear house store a year ago. They were cheap Asian products and it didn’t work. The police had documented the burglary and arrested the contractors that provided these things.
I also have my subs accounts verified, hours worked, labor contracts, etc. I do not often use A GC. I can run payroll for a group of 50 men, including taxes, and making sure my work is paid off when it’s completed. Not a chance of some idiot trying to file a material man’s lein. When I notice someone doing more than I expected, or working harder, better, etc., I ususally will include a BONUS PAYMENT along with a thank you note. You would be amazed at how much good will an extra 100 or 200 or 500 dollars can buy.
The problem I’ve had is that these idiot contractors don’t think I know what they’re doing. My onsite Management guys that I use generally have a legal concealed weapon permit. I have had contractors threaten me, until my manager let him hear the click of a bullet going into a chamber. That calmed the bastard down very quickly. We called the local PD and had the idiot contractor arrested. He sat in jail for two weeks until the judge called me and asked me if I would allow the charges to be reduced. And with good reason. You managed to open so many naive eyes in a short period of time. And sadly, these contractors are often crooks. The ones that are fully honest, quickly become so costly that a normal person cannot afford them. Figuring the best contractors will cost you about 30% above cost. If you’re paying any more for them, you’re being screwed. I routinely get excellent and honest contractors in Electrical, HVAC, Plumbing, Wiring, and framing and finish carpentery. I will now tell them I will allow them NO MORE than 25% above cost. The guys that come in lower than that 25 percent figure may have a better chance of getting the job.
Unfortunately I fell for many of these mistakes thinking that everyone out there is a good person and perform honest work, but now I am chasing both the contractor and subs around to get this job done! Luckily, the job is smaller $10,000, and is not coming out of my pocket directly, but still wanted to get this done correctly. Wish I saw this video sooner. Would have saved me a lot of time and energy
I am currently in my first quick turn which is taking 3x as long as expected because I made all of these mistakes except #3, but I ended up getting screwed badly by telling them my budget...won't be making any of these mistakes again! Thanks Phil!
Thanks Phil for sharing basic but important information. I'm working on my first investment property and have yet been able to find the right contractors for the job. Hopefully learning from you will assist me thanks!
I'm a hvac contractor and you can't even buy the material I get or units if your not a contractor.
Duane Henderson not true, you can get it at major online hvac store.
@@ngoichoi976 ebay
@Jerry Moody that domain is for sale FYI
@Jerry Moody Thanks for the tips.
@Jerry Moody KUDOS to you, I'm sure most people don't have the gusto to do what you did. I'm an HVAC technician and it's not an easy job. I commend you for buying the tools and doing the installs you have done. I have to say that it is legal for a homeowner to buy his own unit and maybe even install (maybe not, idk) it. In the end it just seems like bad practice to install other people's units without a licence.
You, sir, are an amazing speaker. I think this whole home improvement industry is messed up. I had such bad experiences with contractors not answering the phone, now showing up and running multiple jobs even after being paid, I go with companies who have angry (in a good way) people like you as managers to keep the subcontractors on a leash so they complete the job. Worth the extra 20% you pay. Just IMHO. Every homeowner should watch this video as many have lived this nightmare.
Phil, you are spot on with this video. This is Dan in Donelson. I was just like you. Real nice guy, trusted everybody... Then the first Contractor I hired to take the fallen tree off my house, He tried to screw me....
He told me that I don't have to pay a penny, and he will deal with the insurance company directly, no need to worry. Then, a month later he sends an invoice for over $14,000!!! WHAT! This was a 3k-5k job tops. SO, he put a lien on my property, and I got a lawyer, then he pulled the lien off after hearing from my lawyer. What a Total Douchebag! Never trust ANY Contractor.
I wish I saw this video before the tree fell on my house... Thanks Phil!
So guess you don't trust us tradesman.....
I have to agree with all of this. My contractor told me last week that the flooring I had picked out was 'discontinued' and asked if another would work for me, I said yes before checking to find out if he was being honest; he wasn't, the flooring was still available. They are doing a horrible job and everything except for the windows look like they came from a scratch and dent sale. What a disaster.
This is so true. I lost over 80k of three of our flips here in new york, and to take them to court is another 15k plus 3 years of litigation . Sad Face. The people are not your friends.
Wish I would have watched this before getting a nightmare remodel that has to be torn down and redone 🤦🏻♀️ Thank you
Phil, #7 is very important. I had a "friend" bid a very small siding job for me . When it was all said and done he tried charging me almost double the agreed upon price. Thankfully I had priced the materials and stood my ground, but in the end I got the job done for the original agreed on price.
I visited a mechanic and asked him how much the labor was to install an exhaust system. He said $150. I said I had the parts- he told me to leave. I challenged him- it got heated and said what's your deal. He flat out said, I make money by marking that stuff up a lot...then again, suggested I leave...which I did.
Looked for roofing contractors. Due to recent storms hard to get anyone.
Found Web reference... FAMILY RUN BUSINESS FOR XX YEARS.
So I rang them... Yep they are family run business. They put me in contact with local rep (first clue missed).
Rep came out, seemed roof smart. Quoted $5500 but discount for cash, to $5,000.(second clue).
So staggered payments seemed OK. He then got another man to do the job. Asking me not to tell him what I was paying (third clue).
3/4 way through the job, rep said he had to go overseas and pay the worker the final $1000 owed. (weird but to late for a 4th clue).
As the man finished the job he said the $1000 was his payment for the job.
I got truly done.... Here's how....
The Web company was a franchise office.
The rep was the franchisee.
The cash payment... was tax minimization and possibly the franchise fee avoidance.
The rep took his money and ran, leaving the roof man to finish the job.
PS small segments on roof were missed, which finished off myself. No chance of getting anyone back for this.
Done like dead dingos donger..
Phil, I hope you're still making videos and involved in real estate investing. I am so grateful that I came across your channel when I was Googling a question about contractor fees and how they set them. I was relieved to know that we didn't accidentally hire a bad apple contractor -- they practically ALL ARE. And when he revealed to us that he has a criminal record, I was not at all surprised. For years I've been around in-laws, neighbors, workers, employees and contractors who were alcoholic / drug addicts / convicts / codependent / mentally ill / struggling financially. I started wondering why we were attracting that negative energy -- but it's everywhere you look!!!! So for this video alone, I love your fire. Thank you. I actually had a cynical but eye-opening laugh when you mentioned Tennessee. The contractors so far show up between 10 and 11 and leave by 2:30 or 3:00. And even though the contract says "balance due at completion", they're always trying to ask for a draw. I love your idea that they'll start losing money once they pass the deadline. That makes all the sense in the world. So thank you, love.
Watch my entire playlist on working with contractors: ua-cam.com/play/PLcPfCvShc59tDh6dRQUncACahekX9VLrg.html
Most contractors will screw you if they can. But armed with what I teach you on the subject, you can avoid getting screwed.
I have a DUI, been to jail, 34 months clean, repeat clients ask me to house sit and take care of their dogs.
How are you doing 1 year later?
@@fightswithspirits915 19 months sober. 1526 days clean. Got my license back, Bought a 1 ton work van and trailer. I made 100k this year. I put on 25lbs of muscle in the gym. Sounds good on paper but life just has a way of making bigger obstacles as we progress.
@@bradleybates8870 I hear Phil hammering away at contractors with less experience than I have. So, here is what I will say. I know there is WAY more consumers that are less trustworthy than contractors. Honest women and men owned contracting business that are always screws by the CONSUMER by a scale of magnitude.
As a home inspector, most of the houses that I look at that have been fixed up by investors, have been sub quality materials and methods, and usually just cosmetic to get the house sold. There has been great disgreguard to structural, electric or other life safety issues. in the spirit of this video, apparently they were out for a quick buck at the expense of an unsuspecting home buyer.
Definitely - Here's a great rule of thumb for buying a house: Never buy a house from a home flipper or you'll be re doing their work in less than a year.
I know an Armenian guy who's been building high end houses. The houses cosmetically look beautiful but he hires the cheapest subs for the critical items like HVAC and plumbing. A family friend bought his first house and she had to have some of the plumbing and heating redone because it was so bad. The master shower leaked, a separate leak from rain warped part of her first floor, she had to replace the roof shingles, and some of the outdoor stone work was sinking.
Real estate investors are typically *extremely cheap - good contractors are fully aware of this fact. Seldom will a good contractor waste time on a bid with an "investor," because they are often much like Phil is presenting himself in this video. Cheap, controlling, and a bit disrespectful to be honest. They treat tradespeople like they aren't worth a dime, and they *always hire the cheapest bidder - which is usually a criminal. Thus, no wonder they think all contractors are criminals - all they are willing to pay for is a criminal, so of course they're only ever going to have criminals working on their properties. Thus, their properties will always be subpar.
@@manleybeasley9114 True. Sounds like Phil hires guys from off the street instead of working with professionals.
@@manleybeasley9114 you are exactly hitting the nail on the head. Any good contractor would not even give this guy a bid. When you go for the cheapest you get the cheapest in all respects.
Great video , can you do a part 2 more about setting up timelines for contractors.
Do you "fine" contractors when the timeline is not met? Per day?
I'm wondering the same thing. How do you set up the financial penalty after the deadline?
thank you so much for the 7 things , now my wife knows what i'm trying to do in the back yard.
As for materials. Almost Every contractor will mark up materials. I work in the trades ( as an employee) and that just seems to be the standard.
How else do you think a contractor gets paid? We don’t do it for free you know.
yeh if you think im going get ur materials for free well uf fucking stupid
@@jestevanes34
You already get paid for your labor, you're not doing anything for free. Any contractor that won't allow me to provide the materials or refuses to provide me with the receipts for the materials is a contractor I dump. I can understand adding on a reasonable fee for the pickup and transport of materials but anything over and above that is dishonest thievery.
@@Son37Lumiere Then what customers must do is educate themselves on the types of contracts (pros and cons) they want to sign with their GCs. At my family's company we use 4 types and make sure to explain them to our clients as to avoid any difficulties during and after the time of project completion.
You have to decide if it’s worth it for you in terms of your time. There are times I happily pay for the mark-up in order to not have to run around doing the shopping.
I am a women 5'1". During one of the custom homes I designed and built as an owner builder I noticed that the framers looked increasingly unhappy. I asked them what the matter is. They said they haven't gotten paid in two weeks by the framing contractor. I told them that I will fire the sub and asked them if they would stay on to work for me. They tore the contractors sign down and went to work for me after I paid them. We built an awesome house in excellent time that made the local paper on two pages.
Also - I never pay the subs anything upfront because I buy the material. Labor only does not require any upfront pay. One of the contractors took offense with that.
I explained to him that no one who is hired after four years of college will get an upfront payment for coming to work.
Also - make sure they sign a contract stating that they will work 8 hours every day until the job is done. Otherwise they will show up for two hours only. Require the subcontractor to stop by every day for in person communication.
Make sure to tell everybody not to smoke (including chewing tobacco and spitting!), do drugs or drink and don't come to work overhang.
They also need to clean up every day in a reasonable manner.
Keep an eye on the crew of a subcontractor. I noticed very abusive conditions for the crew and all kinds of mistreatment by the subcontractors. Often they hire illegal immigrants or people on probation that don't dare to complain. Ask the crew members if they are treated and paid fairly.
On my site there is mandated respect and dignity for all.
To add - I always take pictures and make videos, am on site everyday and promise and write great reviews and recommendations for those who did a good job. That cuts down a lot on all problems and motivates them all.
this video is hilarious. we did a whole home renovation in 2013 & my wife & I were totally ignorant. I got a real estate license during the renovation process just to learn something & have some base of information to work with. literally going down this list that phil outlines we did every single thing on it. & at the end of the job my wife sued about 7 people involved with the job & luckily won in mediation a year after the lawsuit was formally served. in our case we got lucky because we did things so horribly wrong that the architect & contractor started getting lazy about their con game which enabled us to win the lawsuit easily albeit for 1/2 of the amount we sued for ($300,000 vs $650,000) however it was still a good win.
Are there any good contractors ??? I hear thisall the time from experience cash buyers that their biggest problem is to get a contractor to renovate what they buy it makes me so afraid to ever try to do a flip because nobody wants to do the work
@@uneedmorepeople The problem with flips is the budget is so tight , and supplies have gone thru the roof ! And the pay margin for quality reliable installers has dropped because if that ,, not the investors faut and not the contractors fault something's got to give.
@@uneedmorepeople yes, there are loads of great and honorable contractors. You can find examples of them here on youtube. Quality costs, though. Matt risinger, essential craftsman, kirk giradano and loads more. There are some local to you, I'm sure.
If you're more concerned about cost than quality, you'll have problematic contractor experiences.
Why did she sue ? Did you have contractors that didn't complete work cheat you on materials. Because there's just as many people that screw over contractors i.e. have work done then sue for no reason besides scamming labor and materials from contractors.
@@timrich6755 I love you Tim !
So what's the mark up on realestate investing? Tell me, who deals with problems with the materials you purchase? How do they get to the job site? 2hat happens to the time frame when the job is at a standstill because you screwed up the materials list? As a painter, I seldom let the client purchase material, and if I do, I charge more for the headaches and lost time Im going to encounter. I also make them sign a waiver, I do not guarantee my work, when I am using a 5 dollar can of paint you got at Dollar General.
My paint comes from Sherwin Williams and I buy the best materials. I haven't made mistakes in years. I'm more detailed and organized than any other contractor I have ever worked with.
Phil Pustejovsky Your the exception then, sounds like you would be the guy I'd want to work for. I have worked for a lot of people, professional and private, and trust me, most don't have a clue. I still work on the side, and if I run into a difficult client, I'm sending them to your channel.
@@cre8tivplace222 Use one of the paints recommended by Consumers Reports. If you don't want to subscribe, most public libraries will have the most recent issue containing paint reviews. They extensively test/torture the paint to determine its durability, coverage and other factors.
Sherwin Williams, just like all the other paint manufacturers, have more than one grade if paint and some are better than others. No idea if SW has a grade check marked by Consumers Union.
@@cre8tivplace222 I dont know what kind of paint you were trying to buy at sherwin but I dont even pay a 3rd of that lol and go there every day almost and it's good paint
Just because your paint comes from SW doesn't mean much. If you're buying the crappy contactor grade paint, it's still crap. If you're saying that you haven't made mistakes in years then you're either god or you're full of shit. I'm going to bet on the 2nd option. If you want to get rid of shitty contractors, just stop hiring them... It's not that hard to find good ones. If you're more detailed than any other contractor that you have ever worked for, you need to hire better ones, man.
ANYONE that tells you they can start in a week, or tomorrow..pass on them!! REAL contractors ALWAYS have a back log of work..I used to keep five crews of five guys working year round always! I sold the jobs, and designed them and my men did the work. We were never short of work to do. Just a thought is all.
BUT, in some cases its only that they are really slow and taking very long to get a job done not that they have multiple jobs lined up.
Dude, thank you. The world needs more people like you who are just and fair!
I appreciate that you get heated over someone trying to take advantage of others. It shows that you care, and the world needs more people who care about not letting other take advantage of others. Thank you!
You are so right! For those watching and thinking too.harsh. well you deserve what you get. This guy giving sound advise
Take heed
well in my business. people pay there own material and. half payment of labor payment upfront and finish payment upon completion
8 Never admit that you are recording the conversation or they run for the hills.
That’s illegal in several states lol
@@rsarahi14 And in smart states it is not illegal.;)
Very, very value advice, I've been a general contractor for my own house built and I can share with you in your conclusions, all that's really truth.
This video has been around a while but wow... Thank you! I am a Bigger Pockets fan but you, Phil are a "Matter of Fact" type! No Bs! I Like This! I am a new investor but have already learned that this is F'D UP and a shady world. I never thought the "Street Me" had to come out in legit business but wow. Thank you, Phil! You have a new fan! Wish I had a mentor like you! Will look for updated video.
Well spoken! Dealing with Contractors is oftentimes a street fight. Watch every video in my playlist on Working with Contractors: ua-cam.com/play/PLcPfCvShc59tDh6dRQUncACahekX9VLrg.html
Man, you have a very strong personality, you sound as if you are ready to kill someone. You DO NOT NEED to scream.
But you will if you don’t listen and lose $15k...
Phil I love your passion about this topic. I have a construction business as well and our strategy is exactly what you said, if we're the only one bidding the job we always bid it higher. Great reminders here
Unfortunately, I agree with many of the things you say. I am a GC in Texas. I really wish the state would license contractors here. The MEP's and Irrigation contractors are licensed, but not the GC's. Way too many guys with a card and a truck say they are contractors.
There are a lot of things you advise that I will not adhere to. 88% of my business is from existing clients. I have those clients because I provide excellent service, care about the client's wallet, am on my job sites daily, pay my subs when they want to be paid, but don't over pay my subs if they want paid for more than they are due. I mark up materials on every job that I provide the materials for. I also let the homeowner pay for materials if they want to, If the homeowner buys the materials, THEY are responsible for ordering it, arranging for them to be delivered to the site, making sure they are protected on the site, they are also responsible for making sure none of the materials (ie: plumbing fixtures, lighting, flooring, tile, windows, etc) are the quantities ordered, the color ordered, not scratched, chipped or broken in any way. Making sure all the parts are there for items like plumbing fixtures, making sure the fixtures are not damaged in any way, etc. ) the homeowner is also responsible for the WARRANTY of the materials, since THEY own them. If something has been installed, and is found to be defective, then the homeowner is responsible to pay me to remove the item, and replace it after the homeowner has returned it for a new one. The homeowner saves 20% of the cost of the materials that way. Some choose to do so, most do not. Most see the value in what I do when I purchase the materials.
Isn't it part of your responsibility as the GC to ensure the materials are installed correctly and working regardless of who purchases the materials? That is a large part of what you are being paid for is it not? You are essentially padding your pay by tacking on an additional inflated cost for materials over and above your labor rate. I mean, it sounds like you deserve less pay in that situation, as you are certainly doing less.
That’s a very good point. The only materials I buy is the actual appliances like picking my own replacement faucets, light fixtures of my delight, my own paint, the style of door and window replacement. I also realize the contractor gets a 20% discount on materials. I can always check estimate costs of the materials.
what part of Texas do you GC?
Thanks for your advice. When I told a contractor I wasn't in a hurry to have a bathroom and living built-ins built, it took months to finish. The cabinetry took 2-3 days not including painting. The bathroom took a 2 1/2 months And it wasn't the electrician or plumbers fault. We never had to wait for them. Who takes that long to remodel a 7' x 9' bathroom? So I agree. Never tell a contractor you are not in a hurry. Also, I hate when I type a list of the work I want done and the contractor won't take it. They always leave things off the written quote.
I love that about criminal backgrounds, "...that doesn't mean that they are a bad person, there's plenty of WONDERFUL criminals..." so true. Forgive and forget? Not when it comes to business. Work with moral people.
The same goes for the customers. ( there are some bad apples there too)It's human nature. That's why low bidder usually equals a nightmare for the homeowners they don't know the difference from quality labor and quality products.
I agree with you on everything except on it's human nature. I don't think it's natural for humans to be evil, cheat and scam everyone around them. But I know people do. I wish we could figure out why they do. I wish we could fix them. I think it's a sickness that we should be looking for a cure.
@@warrenthomas1253 Financial stress can bring out the worst in people.
I'm a contractor and your 100% right phill, being in the field I notice their actions are not always ethical, specially the plumbers and electricians, great video.
Great videos as always. Extremely entertaining and full of useful info
This was so helpful. Thankyou so much Phil . My husband just died a month ago and i found out my roof is leaking. There's a 4 by 4 brown spot on my ceiling. It was just 2 by 2 and i thought it was just dirt maybe from my airconditioner vent. But this morning after a 3 day nonstop rain, it grew over night so i have to hurry on this. So i will do what you say about hiring contractors.Take care Phil . Your a good man. Carrie
One thing he should have mentioned ... stay on top of the project ... don’t be a pain in the ass, but DO check the progress and ask questions if you think something is not going as planned or agreed upon.
Great video! Thanks for all the help throughout the years it's really helped me in my success!
Never say: "Love that tie."
Thank you for being just as pissed off about dealing with contractors as me. I live in a small town and have had absolute hell with just trying to get simple work done around my house. 100% agree with this entire video.
It's probably you that's the problem
Spot on! Just because you're paranoid doesn't mean they're not out to get you. Lastly, I always call the insurer to verify coverage directly. How many contractors obtain the insurance and then cancel after they have the documentation?