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How to Vet a Contractor: License Lookup, Insurance, Lien Waivers, and Reference Calls

The homeowners who get burned are rarely the ones who missed a bad feeling. They are the ones who never asked for four documents.

Fixer Upper Pros editorial team · Updated September 2026

Vetting is paperwork, not intuition

Most homeowners choose a contractor on how the estimate meeting felt. The people who get burned are rarely the ones who missed a bad feeling. They are the ones who never asked for four documents that take about an hour to collect and verify.

1. Verify the license at the source

Do not accept a license number printed on a business card or a website. Look it up on the issuing state or local board's public lookup, which nearly every jurisdiction publishes online. What you are checking:

• The license is active and not expired, suspended or on probation.
• The name on the license matches the name on your contract. This is the single most common mismatch. A salesperson representing a company operating under someone else's license is a serious problem, and it is invisible unless you compare the two documents side by side.
• The classification covers your work. A general contractor license does not always cover electrical or plumbing, which are typically separately licensed trades.
• Any complaint or disciplinary history the board publishes.

Understand what a license is and is not. It proves the holder met a bonding, testing or experience threshold and is accountable to a board. It does not prove they are good at the work. It is a floor, not a recommendation.

2. Get the certificate of insurance from the insurer, not the contractor

Ask for a certificate of insurance, then ask that it be sent directly by the contractor's insurance agent with you named as the certificate holder. A certificate emailed as a PDF by the contractor is a picture of a document, and it may be out of date or edited.

Read three things on it:

• General liability coverage and limits. This is what pays if their work damages your home or injures a visitor. On residential remodeling, a one million dollar per occurrence limit is common.
• Workers compensation for their employees. This is the one that matters most to you personally. If an uninsured worker is injured on your property, you can find yourself the deepest pocket in the room. If the contractor uses only subcontractors and carries no workers compensation, ask for each subcontractor's certificate too.
• The policy dates. A certificate that expires in the middle of your project is a certificate for half a project. Ask to be notified on renewal.

3. Understand lien waivers before the first payment

In most states, a subcontractor or material supplier who is not paid can place a mechanics lien on your home even if you paid your general contractor in full. You can pay twice. Lien waivers are how you prevent it.

• Conditional waiver on progress payment: becomes effective when the payment clears. This is the one you exchange for each progress check.
• Unconditional waiver on progress payment: effective immediately. Only sign or accept this when the payment has already cleared.
• Conditional and unconditional waivers on final payment: the same pair, for the last check.

The practical routine: with each payment, collect a signed waiver from the general contractor, and on larger jobs also from the major subcontractors and the lumber or cabinet supplier. Write this into the contract as a condition of payment so it is not a favor you are asking for later. Rules and form names vary by state, so ask your contractor which forms their state uses.

4. Make reference calls that are worth making

Asking for three references produces three happy customers, because that is what the contractor selected. Improve the sample:

• Ask for the last three jobs completed, in order, rather than three references of their choosing.
• Ask for one customer from at least two years ago. Recent customers tell you about the experience. Older customers tell you whether the tile is still flat and whether anyone came back for the warranty call.

Then ask questions that cannot be answered with "they were great":

1. How did the final price compare to the contract, and what drove the difference?
2. How many change orders were there, and were they presented before or after the work?
3. Was the crew the same people throughout, or did it turn over?
4. How did they handle the thing that went wrong? Something always does. The answer to this question is the most predictive one on the list.
5. Did anything need warranty attention after completion, and how long did the callback take?
6. Would you hire them again for a larger job?

If you can, ask to see one finished project in person. Ten minutes looking at trim joints, tile edges and paint lines tells you more than any photograph.

Payment and paperwork discipline

Keep the deposit modest, typically 10 to 30 percent, and tie the remaining payments to completed milestones rather than dates. Never pay in cash, and always pay the company, not an individual. Hold a final retention of five to ten percent until the punch list is done and the permit is closed. Many states also give you a statutory right to cancel a home solicitation contract within a few days, which should be disclosed in the contract itself.

Red flags that end the conversation

• Pressure to decide today, or a price that is only good this week.
• A request that you pull the permit as an owner builder.
• No written contract, or a contract with no scope, schedule or payment milestones.
• A large cash deposit, or a request to pay a person rather than a business.
• Reluctance to provide a license number or a certificate of insurance.
• Door to door solicitation after a storm, especially with out of state plates and no local address.

An hour of verification up front is the cheapest hour in the entire project.

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