Contractors: Is there a reason why a contractor will promise a job done by a date and fail?

Question

I've heard horror stories about contractors promising to do a job (i.e. remodel a kitchen or a bathroom or a deck, an extra room addition) by a certain time and at a fixed price. But as time goes by, they need more money to finish a job. Usually, the home owner goes broke and/or job never finished.

My parents remolded their entire home. The work was promised to be finished w/in 6 month. It's been a year and the house is still uninhabitable. We have a contract and everything has been paid for as scheduled. We have a lawyer now. But what can cause an established contracting company to fail on their word/contract? Is there a legitimate reason?

Answer 1

The situation your parents have found themselves in is awful. Unfortunately, we hear more of these stories than of the ones where homeowners are totally thrilled with the outcome, and the process taken to get there. Here are some of the most common reasons for these renovation nightmares:

1) Project was too large or complicated for the contractor and he is having a nervous breakdown or depression of sorts.
2) His workers are not properly skilled or he does not have enough skilled workers on his team.
3) He has very poor organizational skills & now got himself into a jam he doesn't have the faculties to get himself out of.
4) Domino effect -- the project prior to your parents' home took much longer than expected & instead of telling them he would have to start 6 weeks late he tried doing a balancing act and any project that runs longer than planned for costs more (workers have to be paid by the hour, not by the job) so money from your parents' job went toward finishing the previous job and he is now stuck in a catch-22.
5) Personal problems -- death or serious illness in his immediate family, or maybe even he himself is facing medical problems. Many people feel ashamed to admit to a client that they need 2 weeks (or whatever amount of time) to grieve or recover their own health.

None of these things are excusable; contractors are supposed to conduct themselves in a professional and ethical manner, but it is easier than most people would imagine for them to land up in these types of situations. Often it takes one bad client (for instance a homeowner holding back $5000 because a door doesn't operate smoothly) to put a contractor into a bad situation that can require months to recover from. Not everyone has what it takes to get through this type of mess without making it worse.

You mention your parents hired a lawyer. Make sure the lawyer has experience with this type of case because construction law is quite different from other civil matters - a case like this, if it goes to court, will delve into issues beyond contracts not being respected. Depending on your location, there is probably an association for licensed contractors, and this association might have mediation services available for a minimal cost to your parents, information about such situations and how to handle them, or at the very least a department where a complaint can be filed so that this contractor doesn't put another family into the same situation your family is going through. Good luck!

Answer 2

The biggest problem is that most contractors, have different crews working different projects, and if some one doesn't 'pay' then they have to rob peter to pay paul, or, if something goes 'over', then they are still shoveling the monies to different priorities.

A lot of "fly by night" contractors are famous for this, thats why you get with the Better Business Association and see who has the least "complaints" against them. (Though, this doesnt always guarantee that they will produce, because the Contractors 'PAY' the Better Business Association to be on the "list").

There is never a sure fire guarantee that any job will get done on time, unless a very well established business can survive (with enough cash), any pitfalls that may occur. Also, remember this, any "extras" you want, that wasnt in the original agreement takes extra time, and ordering when not available, so, that is out of thier hands at times, when you have to go to Manufactorers and it may be out of stock at the moment.

I wish you well..

Jesse

Answer 3

You have to do your homework.The cheapest contractor almost always is the worst.Get a contract.Hold a large percentage until completion 30%. Fines for every day over finish date. Stick to your original contract. Don't change the plans.This costs more and slows down the contractor. And don't offer to help us.Things go smoother if you aren't there. Aggravating homeowners make employees lay out of work (contractors too)

Answer 4

Contractors do that because usually know they can't finish on time but they don't want you to use someone else. Usually the same with the money. They know it will cost more then what they tell you so you will hire them. Then once it is started they try and get more money. Welcome to the joys of hiring contractors.

Answer 5

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Answer 6

normally overstretching or overspending while running a few jobs at the same time
its a world wide problem ,it doesn't matter were you go ,people are complaining about the builders.
i'm doing my own house to solve that problem
best of luck in sorting it all out