If you can find a house that needs to be rehabilitated and then sell it for more than your total investment, you will always come out ahead. That's the general rule of house flipping. Most dedicated house flippers will end up getting real-estate licenses so that they can generate more profits by paying less in sales commission fees, and there are others who are good enough at doing home repairs that they complete most of their own work. When you become a veteran house flipper, however, you'll want to go beyond making cosmetic repairs; you'll be hiring professional plumbers, foundation repairers, and electrical and roofing contractors every day. You can trust that every home improvement professional you hire will meet your needs by utilizing contractor bonds and taking these seven smart steps towards safeguarding the investments you make in your house flipping business.
1.Verify Each Contractor's Business License Standing - Chances are that an electrical contractor won't be able to work on a home remodeling project in your town unless they have an applicable business license. On the other hand, you can't just trust that a contractor that you work with has the proper credentials unless you have seen and verified them. A quick phone call can help you to learn if your home remodeling contractors have current and proper licensing.
2. Work With Bonded Home Contractors - Home improvement specialists who have completed jobs for a myriad of clients know that contractor bonds can help to secure more winning bids by making their customers feel more at ease. Since contractor bonds represent an enforceable guarantee to customers that they will get what they pay for, you should solely work with bonded contractors to protect your investments.
3. Make Milestone Payments For Services Rendered - You can give your contractors a portion of the total amount owed for your improvement projects at the beginning and then pay another portion when the job is approximately halfway complete. Milestone payments will help to protect you as well as each home improvement professional that you contract with, as you will never be left unsatisfied and they won't get paid less than the agreed-upon amount.
4. Ensure Bonding Is Covered In Your Contract - The contractors that you hire to perform improvements on your real-estate investment projects may be bonded, but you have to include what provisions are to be made if their services aren't quite up to par. Ensure that contractor bonds and other satisfaction requirements are covered in your contract before any work begins.
5. Have Other Contractors Lined Up - Part of being a successful house flipper is being able to keep all projects running on schedule. You can't afford to have a single contractor delay your home improvement projects, so use contractor bonds to secure other home improvement specialists if things don't go according to your mutually agreed-upon time schedules.
6. Hire A Business Lawyer - When polite requests go unanswered, it is best to get a highly motivated business attorney involved. If you are in the house flipping business, you should have a business attorney on retainer who is familiar with each of your projects so that inquiries and demand letters can be drafted up swiftly, if need be.
7. Confirm Work Is Being Performed According To Schedule - Contractor bonds can help house flippers to keep projects running smoothly, but many delays can be prevented by simply confirming that all work is being done to your specifications. Go on site to each real-estate investment property where improvements are being made so that you can see what is being worked on and find out how long everything will take to be fully completed.Share