It’s Worth Effort to Check Out Contractor : A bit of caution can protect homeowners’ quake relief funds

You’ve waited in line. You’ve signed up for aid to cover the damage your home sustained in the Northridge quake. You’ve filled out the requisite forms. You dutifully waited for the inspectors who had to assess the situation, and you’ve been watching the mailbox every afternoon as if you could make that check materialize through sheer force of will. Now, that you finally have it, the hard part is over, right?

Wrong.

Now, it is time to be doubly careful. And you cannot allow the impatience that has undoubtedly struck by now to cloud your judgment.

The problem is that much of the quake relief aid has only recently begun to flow. In the interim, people have been forced to live in homes that really suffered in the quake. Others have not even been able to occupy their homes and have been renting or have been forced to live with friends or relatives.

Some people now have to start from scratch. Folks are fed up, and want the repairs and the rebuilding done yesterday.

But the quake has created a boom in local construction contracting. That’s great for the local economy, and very bad for your patience quotient. At this point, some of the contractors you call say that they are booked up months in advance. It’s become a classic sellers’ market.

The contractors can pick and choose among the more lucrative jobs. Some say that they are tired of doing free estimates and are charging “token” fees just to look over the work to be done. And the added frustration of this new waiting game may just persuade some of you to throw up your hands and pay someone you haven’t fully checked out. You must avoid that at all costs.

Obtaining the license number of each of the contractors you are considering and verifying it by calling the Contractors State Licensing Board (1-800-321-CSLB) is important, but it is only a first step.

You must also be certain that the contractor has workers’ compensation insurance. So far, the CSLB has assessed 117 fines against contractors at work on quake repairs who could not furnish proof of such insurance. For the homeowner who hires a contractor who does not have insurance, the situation can turn into a nightmare. So says Dennis Bishop, the supervising deputy for the unlicensed activity unit of the CSLB, who is based in Buena Park.

If a worker is injured while repairing your home and the contractor does not have workers’ compensation insurance, Bishop says, “the owner of the property could become liable.” Bishop suggests that people ask contractors for a copy of their current certificate for workers’ compensation and then call the insurance company listed on it for verification.

Other rules of thumb might seem equally burdensome, but can help you avoid headaches in the long run.

Ask for references and check them carefully. Anyone, Bishop points out, can drive by a work site, snap a photograph and then claim that they did the work.

Once you have obtained a range of estimates, you should find that the high and the low should not differ by much more than 20%. Try to look at it like judging at the Olympics: If the bids vary by more than that, throw out the high and the low and consider the middle-range offers.

Stay away from contractors who ask for large amounts of money before they even start the work. State law restricts contractors to a demand of no more than 10% or $10,000 up front, whichever is less.

It’s entirely possible that all of these steps will seem insufferable to you, especially since you’ve already waited months for the federal funds that will allow you to repair your home. Just remember that your home is the most important material investment of your life, and no one is going to cut you another aid check if you waste the one you have now.