Make sure the builder or home remodeler has a permanent business location and a good reputation with local banks and suppliers. Chat up the folks at the contractors’ desk at the local lumber yard or other suppliers.

Find out how long they have been in the building business. It usually takes three to five years to establish a financially sound business. You want to make sure they will be around after the construction is complete to service any warranties.

Check out the company’s rating and if there have been any complaints filed with your local Better Business Bureau: www.bbb.org. It is also becoming more common for builders to have Internet ratings which can be helpful.

Make sure the builder/remodeler has sufficient workers compensation and general liability insurance. If not, you may be liable for any construction-related accidents on your premises. Keep in mind a Worker’s Comp waiver is allowed for the owner but not their employees.

Ask the builder/remodeler to provide you with names of previous customers. If they won’t, beware. If they do, ask the customers if they would hire the builder/remodeler again.

Ask if you can see the builder/remodelers work, both completed and in progress. Check for quality of workmanship and materials.

Do you feel you can easily communicate with the builder/remodeler? Remember you will be in close contact with them throughout the construction process and afterward as you live in your new home.

Make sure the builder/remodeler provides you with a complete and clearly written contract. The contract will benefit both of you. If you are having a new home built, get and review a copy of the home warranty and homeowner manual as well. All new built homes must have contracts per state laws. Remodels do not require a contract.

Never pay for work in-full up front. It is reasonable to pay a deposit, but hold the remaining payment until work is completed to your satisfaction.

Be cautious of unusually low-priced bids. If the builder/remodeler is unable to pay for the materials and labor as the project proceeds, this may indicate a potential problem. Keep in mind that less expensive does not necessarily mean better!