How to Hire a General Contractor — Complete Guide

Hiring the wrong general contractor is the single most expensive mistake you can make on a renovation project. A bad hire does not just cost you money — it costs you months of your life, damages your property, and creates legal headaches that can last years.

This guide walks you through exactly how to find, vet, and hire the right GC. I am writing this as a licensed general contractor, so I am going to tell you what we actually care about and what separates good contractors from bad ones.

Step 1: Understand What a General Contractor Does

A general contractor (GC) manages your entire construction project. They are responsible for:

• Scheduling and coordinating all subcontractors (plumber, electrician, framer, etc.)
• Pulling permits and managing inspections
• Procuring materials and managing deliveries
• Quality control on all work performed
• Budget management and change order processing
• Communication with you throughout the project

A GC does not necessarily do the physical work themselves. Their value is project management, trade coordination, and accountability.

Step 2: Find Candidates

Start with three sources:

1. Referrals from people who have completed similar projects. Not your uncle who "knows a guy" — someone who had a kitchen remodel, bathroom addition, or whatever matches your scope.
2. Your local licensing board. Every state has a contractor licensing board — search "[your state] contractor license lookup" to find yours. Search by license number or name to verify active status before you meet with anyone.
3. Qualified lead sources. Houzz, Nextdoor, and local builder associations. Avoid services that sell your info to dozens of contractors.

Aim for 3-5 candidates to contact initially. You will narrow to 3 for estimates.

Step 3: Verify Credentials

Before you meet with anyone, check these five things:

License

Every state has a contractor licensing board. Verify:

• License is active (not expired, suspended, or revoked)
• License classification matches your project (B license for general, C licenses for specialty)
• The person you are talking to is the actual licensee or an authorized employee

Insurance

Request a Certificate of Insurance (COI) directly. Do not accept a verbal confirmation. You need:

• General liability: $1M minimum per occurrence
• Workers compensation: Required if they have any employees
• Auto insurance: For work vehicles

Call the insurance company to verify the policy is current. This takes 5 minutes and could save you from a six-figure liability.

Bond

Many states require contractors to carry a surety bond. This protects you if the contractor fails to fulfill the contract. Bond requirements vary by state — check with your state licensing board to confirm the requirement in your area and verify the bond is active before signing anything.

References

Ask for 3 references from projects completed in the last 12 months. Not 3 years, not 5 years — 12 months. Construction businesses change fast.

When you call references, ask:

• Was the project completed on time?
• Was the final cost close to the original estimate?
• How did the contractor handle problems?
• Would you hire them again?

Online Presence

Check Google Reviews, Yelp, and the BBB. Look for patterns, not individual reviews. One bad review means nothing. A pattern of complaints about communication, timelines, or unfinished work is a red flag.

Step 4: Get Detailed Estimates

Getting detailed estimates is only valuable if you know how to read them. Our guide on how to read a contractor estimate breaks down every section — scope, allowances, exclusions, and payment structure — so you know exactly what you are comparing.

Once you have vetted 3 contractors, invite them to bid your project. Here is what a professional estimate should include:

Must-Haves in Every Estimate

• Detailed scope of work — line by line, not a lump sum
• Materials specified by brand, model, or quality tier
• Labor broken out from materials (not always, but helpful)
• Timeline with start and completion dates
• Payment schedule tied to milestones
• Exclusions clearly listed
• Warranty terms

Red Flags in Estimates

• Lump sum with no detail ("Kitchen remodel — $65,000")
• No exclusions listed (they are hiding something)
• Payment schedule that is front-loaded (more than 10% upfront)
• Verbal estimates with no written documentation
• Significantly lower than all other bids (they are either cutting corners or buying the job)

Step 5: Compare Apples to Apples

The lowest bid is almost never the best bid. Compare estimates by:

1. Scope alignment — are all three bidding the same work?
2. Material quality — is one using builder-grade while another uses mid-range?
3. What is excluded — one bid might exclude flooring that another includes
4. Timeline — a faster timeline usually means a larger crew, which means higher cost. A suspiciously fast timeline means they are underestimating the work.
5. Communication quality — how responsive were they during the estimate process? That is how they will be during the project.

Step 6: Sign the Right Contract

Never start work without a written contract. At minimum, the contract should include:

• Full scope of work (attach the estimate)
• Total contract price
• Payment schedule tied to completion milestones
• Start and completion dates
• Change order process (how changes are priced and approved)
• Dispute resolution (mediation before litigation)
• Termination clause (how either party can exit)
• Permit responsibility (contractor pulls all permits)
• Lien release requirement (contractor provides releases with each payment)

Step 7: Manage the Relationship

Once the project starts:

• Communicate in writing. Text or email, not phone calls. You want a record.
• Visit the site regularly. Weekly at minimum.
• Never pay ahead of work completed. Milestone payments only.
• Approve change orders in writing before any additional work begins.
• Request lien releases with every progress payment.

The 10% Rule

Never pay more than 10% of the contract value as a deposit. Many states cap contractor deposits by law — California, for example, limits deposits to $1,000 or 10%, whichever is less. Even in states without a hard cap, paying more than 10% upfront is a major red flag. A legitimate contractor with good cash flow does not need a large deposit. If they ask for 30-50% upfront, walk away.

Bottom Line

Hiring a general contractor is a decision that will affect your home, your finances, and your stress level for months. Take the time to vet properly, get detailed estimates, and sign a solid contract.

If you want a structured process for this, our Contractor Hiring Checklist walks you through every step with interview questions, verification templates, and red flag scorecards.

Related Guides

• Contractor Red Flags
• How to Negotiate With Contractors
• How to Read a Contractor Estimate
• DIY vs Hire Contractor