Investor Mistakes that Can Really Bite - Contractor's Fees

By
Real Estate Agent with Excellence in Real Estate Tm @ Allison James Estates & Homes

Investor Mistakes that Can Really Bite - Contractor's Fees
by John Occhi REALTOR
Realtor Consultant to Foreclosure Investors


View More Articles on Investor Mistakes That Can Really Bit by Clicking Here

Don't get me wrong, contractors earn their money, especially if you negotiate fairly and have a clear understanding of what will be done with what materials and how much you will pay.

The problem that I have fallen victim of and seen on many occasions is allowing a contractor to be paid in full before the job is done. I don't know what it is about these guys, but they always seem to have a reason why they need to get paid, as the job is nearing the completion.

It is typically some hard luck story. They will usually come in and work really hard for a day or two and then say that they need some more money because... maybe it's one of their guys or their wife or ... who cares - it's an excuse.

What will undoubtedly happen is the contractor will get your final payment and then never come back. Maybe, all they have to do is the job clean up. Maybe they just need to put up the finish trim. Who knows? Really, who cares?

So do yourself a favor and NEVER pay a contractor until the job is finished - 100% satisfied. Don't ever pay a licensed contractor in cash. When you cut the last check, wait a day after completion and then put it in the mail. This way you are sure you are satisfied with everything.

If the final payment is no less than 5% or 10% or even 20% of the job, it is enough to make sure the contractor is there - after all, you are holding his profit!

There is not much more to say on this topic - just be careful in your negotiations and job management and the cost of the contractor should be nothing more than a legitimate business expense for your real estate investment.

Hoping to make your California Real Estate Investment...
A Pleasant and Profitable Experience,

John Occhi, Hemet CA REALTOR

Posted by

Until Next Time, Have a Blessed Day,

John Occhi, ePRO & Five Star Certified REO REALTOR®
www.JohnOcchi.Com
Hemet - San Jacinto Valley, CA
The Excellence in Real Estate Team @
Allison James Estates & Homes
2281 W. Esplande Ave, #102-B
Next to "Starbucks"
San Jacinto CA 92582
(951) 654-5550

Excellence in Real Estate,Team Log,John Occhi,www.johnocchi.com,hemet,san jacinto,CA

Allison James Estates and Homes Logo     

 


This blog and the contents written here is the intellectual property of John Occhi, San Jacinto Valley REALTOR® in the South West Riverside County region of the Inland Empire of Southern California.  The views and opinions expressed are just that - views and opinions of John Occhi and those who comment.  Please note that I am not an attorney or a tax professional and any time I discuss either topic, I suggest you consult with the proper professional for relevant assistance.

This blog is part of the ActiveRain Real Estate Network, which is a social network highlighting the best of Web 2.0.  Information is provided with the intent of educating and assisting home owners, home sellers, home buyers and real estate investors with information the can be used to make better real estate decisions.

I am proud to be a full time REALTOR® who is proud to be a contributing member of the ActiveRain community.

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Location:
California Riverside County Hemet 92544
Tags:
real estate
contractor
investor
mistakes

Spam prevention
Show All Comments
Rainer
12,282
John Occhi
Excellence in Real Estate Tm @ Allison James Estates & Homes - San Jacinto, CA
ePRO, Five Star Certified, Riverside Cnty REO Expert, 951.443.6259

I was reminded that in California a contractor cannot demand to be paid in advance. It is a good idea to have an escrow holder for the contractors partial payments and an appraiser that inspects the job as it is completed to authorize the escrow holder to make the payments. The owner should totally remove himself from the payment process in order to avoid these "stories" from the contractor.

Hoping to make your California Real Estate Investment...
A Pleasant and Profitable Experience,

John Occhi, Hemet CA REALTOR 
Realtor Consultant to Foreclosure Investors
Mission Grove Realty

Aug 19, 2007 05:51 AM #1
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
12,282

John Occhi

ePRO, Five Star Certified, Riverside Cnty REO Expert, 951.443.6259
Ask me a question
*
*
*
*

Additional Information