Finding a good contractor to build or remodel a house is a challenging task that may bring lots of frustration. As seen from complaints on our website, consumers often face issues with home construction companies, contractors, and even home construction scams.
To help you avoid such issues and improve your house building or remodeling process, we’ve interviewed a home construction expert, Matt DiBara. Matt represents The Undercover Contractor, he is the owner of DiBara Masonry, a family-owned and operated company in Los Angeles that specializes in repairs, restorations, and new installations.
... I'm not here to say that every contractor is bad. I'm here to say there are enough people that aren't great… It's just you're the one who's going to be your best advocate.
In this video interview, Matt shares his insights on the home construction process and gives tips on how to work with general contractors and avoid scams.
Top Things to Know About Home Construction and Remodeling:
- How to choose a construction company?
- How to find a contractor online?
- How to handle negative reviews about contractors?
- How to avoid mistakes when hiring contractors?
- Stopping the construction project and rehiring
Matt DiBara: I'm Matt DiBara, owner of DiBara Masonry, otherwise known as the Undercover Contractor. I've been doing masonry and concrete, my family's been doing it for 102 years. It dates back to Italy. I've been doing it since I was nine. That was my first day on the job, and I mixed my first bag of concrete when I was nine.
And then through there, I kind of grew in this industry and obviously took over the family business, relocated that to Los Angeles. I've been around construction kind of my whole life. I've been on over 4,000 sales appointments. So I have a good understanding of the process of construction, right, and where the shifts and changes are. You know, I sat with my dad on his lap when I was nine years old, or next to him rather when he would meet with the guy at the Yellow Pages. That was the only form of advertising all the way up through to when, first, companies started using websites, and then up until now, which you have all these companies like Yelp and different avenues for contractors to advertise.
How to Choose a Construction Company?
Michael: Tell us about what are the main issues that consumers may encounter when they choose a construction or reconstruction project for their houses?
Matt: I think there are two things to know, right? You said the most expensive purchase is the home. The second most expensive purchase for the average American is actually the maintenance of the home over the next 20 years. It's not your college for your kids. It's not your car. It's the maintenance of the home.
So I think one of the first things is to understand that these are big purchases. You spend a lot of time looking for the house you're going to buy, and you have a whole team of people making sure that that goes right. Realtor, mortgage broker, home inspector. When you go out to hire a contractor, it's you on a website by yourself.
...understanding how that process looks, and how you really have to self-govern it, is really important.
I think that's the first thing, is to not take it lightly. Don't make it a few Google searches and then you're done.
The second part of it is that construction's changed a lot over the last 10 years. A lot of good people got out of the industry in 2008. So, know that the dynamic is shifting and not necessarily in the consumer's favor. We don't have a big team of people helping us, and things are shifting to a less desirable place, in my opinion.
So knowing that, what do I do? Well, some things you can avoid is, you want to understand the service that you're looking for. You have to define the service really clearly. So is it a restoration? Is it a remodel? Is it a reconstruction? Is it a repair? Is it a renovation?
The second thing we want to know and avoid is understand that we're in a process. So in my book, I break it down into four simple parts. You've got to find contractors, build your list, vet them, cut them off your list for certain criteria, hire them, which is to sign the contract, and then manage them throughout the process.
Knowing where you are in the process is helpful because you can put everything in buckets and move along uniformly. I see a lot of people and they have different contractors in different phases. So it's like, I've got three people that I'm vetting. I'm still adding people to my hire list. And one person sent me a contract and I might sign it.
So you're doing all of these things, but they're all crossed. And so when you move uniformly and you say, okay, I'm on the find phase: I'm just doing research and building a list. I'm in the vetting phase: I'm scheduling all my appointments. I'm in the hiring phase: I'm saying who's going to give me the contract. You have things very clear where you can understand them and truly compare. It gets kind of a little crazy when you're like tying it all together like that. And it's messy.
How to Find and Choose a Contractor Online?
Michael: Yes. We live in different worlds. Consumers are Googling right now and that's how people find new contractors. What do they look for in a contractor that they found on Google?
What are the tips that you can provide? What to ask of a contractor? Typically in the past, consumers would shop for a contractor based on word of mouth, asking their friends, relatives, what they've done. But how do you vet a contractor that you've found online?
Matt: You want to look at a couple of things. You want to look at their website and understand their history. Where are they at now? And why are they doing this? You want to look up their license number, their workers' comp if they say they have employees. You want to research the services that they provide, ideally the services that they highlight.
- Check Their Website and History
Matt: You really want to find a company that specializes in your service. That's why I emphasized earlier defining your service clearly because if you don't do that, you can't then go on the website and make sure they do it.
A lot of contractors, and to your point about them not being online, the ones that are, some of them have generic websites. So it's kind of like a menu where they have every food group you can imagine. And I always tell clients, I say, look, our goal is not to have the chef that makes a meal once a year. We want the chef that's making that meal 20 times a day, every day. Right?
Better product, more consistency, more people doing it... you look at branding, you look at history, why they're doing it.
- Look Across All Channels
Matt: Those are some of the basic peripheral things. You also want to look across multi-platforms. So, you've got all your different sub-sites, Angie's List, Home Advisor, Howse, Yelp. So you want to really get a picture of a company because what contractors will do is they may have a platform where they got some bad reviews and they stopped running advertising money to that platform. And so they try to push up a new platform.
I want to look at it across all the channels I can find. I want to see your Facebook. I want to see if you have an Instagram. And I want to get a very diverse look at that. And I want to weigh that down with you talking about a specific service. It's really difficult if the company isn't specific with their services. So that's really important.
- Read Reviews
Matt: And then you want to read the reviews. I've seen cases before where companies will do less of certain services. And if that's the service you're looking for, you may find that they have a hundred reviews, four and a half star rating. But those three negative reviews were for hardwood floors, and that's what you're looking to have done. You're not doing kitchen remodels, right? So it's really important to look at the reviews.
I look for a certain foreman on the crew that gets really good reviews because later I write that down and I can request that person. So if they're like, “Hey, you know, Matt was awesome. He was great.” I want to look for key names. I think that's important. It's also an indication of turnover. If you call them up and they're like, oh no, that great person that got all those great reviews, no longer with us anymore. That to me is a yellow flag, something to consider.
How to Handle Negative Reviews About Home Contraction?
Michael: Any business can have ups and downs. Have you had bad reviews?
Matt: I've had bad reviews. Absolutely. I've had them posted. But the way we handle it is we pick up the phone and we call and we work it out. So I don't know that I have any right now that are long standing bad reviews, especially for work we've done. But I've certainly had people upset.
But a review in my opinion, right, and this is where I love your site and I love what you're doing. Because you're basically, the reviews, they all bubble up to the surface like you say. Consumers should have an outlet to talk about this stuff, I agree, I think if it was a horrible experience.
...the best customer feedback for a business that you could ever ask for like a pissed consumer is literally your best marketing feedback because you had to do so much.
I love pissed consumers, right? I don't really get them often if at all, but I think it's amazing. And I think businesses miss the bar, because when you have a pissed consumer and there's that much emotion and that much investment in something you did where they exchange money and originally trust, right? Because they exchange trust and money with you to do business.
It's like, you are literally getting feedback about your service, about your delivery. And to me, it's like, I thank them. The first thing I would do is I would call them up and I would say, thank you. Because if you didn't write that review, it could have killed my business. Because enough people who are quiet and angry in silence will put a business out of business.
So first of all, I would thank them. And that's what we do. I'm like, thank you so much. And I mean that it's not sarcastic. I'm like, wow, this is amazing. You know, I had no idea that we did this, or I had no idea this was important, or that we did that. And so that's the first thing.
And so it's a shame to me that more companies don't take that stance of, well, if somebody exchanged trust and money with you and they're no longer happy, I take it as if I fell short. So, have we had bad reviews? Absolutely. But I think my viewpoint now I handle those is a little bit different because a review is not forever in my opinion.
It can be, but it doesn't have to be. It could be how I feel at this particular moment in time, but it doesn't dictate what I'm going to feel like a week from now if you call me and make it right.
I grew up in a family business. We got into this industry, construction because we loved it and we love what we do. And so I've always carried that passion and I think that we need more of that in consumer spending across the whole. I think we need more passion and true, genuine appreciation.
If you have a bad experience, you need to speak up.
I did a job for a client who was so sad. I did a job for a client and I literally ended up doing work across the street. And they both were scammed by the same contractor doing the same thing. Right? They're neighbors, and they didn't even know it. And neither of them wrote a bad review. And I asked them, I said, "Well, why didn't you put this on?" And like, "Well, we probably should have known better. And it was our fault." I'm like, "It's not your fault."
At the end of the day, they're taking your trust in your money. Now, do you need to be more prepared in the future? I already made my argument. I think you do. But in the end, it's not your fault.
How to Avoid Mistakes When Hiring a Contractor?
Michael: What are the typical mistakes that you've seen in the industry? What consumers should be watching out for?
Matt: Absolutely. That was my favorite question. Stolen deposits are one common one. So they take a deposit for the work, never showing up. Unlicensed work is another one, and I'll talk about how to kind of avoid some of these things. Not pulling permits is another one.
A contractor says, "No, Mr. And Mrs. Jones, you don't need a permit." And they said, "Okay, great." And then they find out later when they go to sell the house, there's an issue. I mean, scheduling stuff. Start the work, do work for a week, leave for two months. What are you going to do? They hold the permit.
I mean, there's a lot of things that we see. Swapping materials is another one. You paid for a beautiful Brazilian hardwood and you've got a local Home Depot Redwood.
I mean, there's a lot of ways to do it. And if you don't know the industry and you aren't really rooted in it, it becomes very hard to spot these things. And even contractors, fellow contractors, that I'm friends with have been scammed in things outside of their zone of excellence and focus.
- No Money Upfront
Matt: So things to look out for. If I were going to summarize it right, because I can't summarize the whole book.
...the big pain points are money upfront, red flag, unless there's a specific material that you're purchasing that you want to see a receipt for…
...and you want to know how much it cost and you only want to pay for that material. So money upfront, I really advise against it. That's the first one.
- The Friend Test
Matt: The second one is what I call the friend test. And the friend test is basically, let's say we're doing a kitchen remodel, right? Simple project, but a lot of moving parts. What I tell people to do is take that agreement before they sign. So at this point, you're in the hiring phase.
You say, "Look, I want to move forward. I need to see your agreement." And you can do that with more than one company, by the way. I recommend sometimes doing it with two. But you take that agreement and you give it to your friend and you have them read it and explain what is happening because they've never seen the project, but they should be able to describe every single detail and everything through that sheet of paper.
Because guess what? If you end up in court, that's what's going to be your driving factor for equity and fairness in this process. So if they're like, "Well, I see you're doing a sink, but I don't know what sink it is." And you go, "Oh, okay, good point. Yeah." He didn't put the model number in there or, "I see that he's painting the wall, but it doesn't specify color." Right? That friend test really does a lot.
- The North Star Approach
Matt: The next one you want to do is you want to talk about a schedule. This is a huge, huge point. You want to understand whether or not your work is going to be interrupted or not. And what I mean by that is can the contractor start your job, and then he's got to leave, let's say for an inspection, he or she. And what's the duration in which they have to come back? Is it two days? Is it a week? Is it a month?
I always like to get us a set of expectations. And what I tell clients so that they can remember, I created what's called the confident homeowner system. So I want to make a system. That's the find, vet, hire, manage, this whole process, is really to restore consumer confidence, confidence as homeowners. Because when I hire I'm confident, but that's not fair. Right? I shouldn't be the only one. My family has been doing this for a hundred years and not everybody's going to have that.
So how do we duplicate that? One simple tool is called the north star approach. And what I mean by that is so many times in construction do clients have verbal conversations and then those conversations not come to fruition? And so what I say is, if you can't point to it, I'm like "Visualize a star, the north star." I don't care where you are on this earth, you can point to that star.
You want something that you can point to that is objective, meaning it's there. It can't be interpreted as something else. So you can take two people on different points of this earth, or two perspectives, and they can both point up and look at that one thing as a common understanding. So if I'm going to get a schedule, I want to know how long it's going to take, what potential delays might be. And then what a worst-case scenario might be.
The biggest thing in construction is prevention and mitigation, right? So you want to prevent as much as you can. As I said, no money down, making sure you define your right service, understanding what phase you're in. Those are really prevention. But the other thing is…
...the fastest way to stop losing money is the moment you realize you're losing money.
The second fastest way was five minutes ago. So I talk to consumers and clients about the fact that by having these benchmarks, you can start to see where things move off. So in commercial construction, if you're going to spend $10 million on a building, you're going to get a schedule, right?
They're going to tell you an HVAC may take a month. And so by week one, you should be a quarter of the way done. Week two, you should be half. And so you have a very clear way of saying, wait a minute, are you a quarter of the way done? Right?
So I copy the model, or some of the best practices, of construction projects where you're spending lots of money because I don't feel like just because you're not spending $10 million doesn't mean you shouldn't have transparency.
I think that's a big issue in construction is commercial construction. If you're spending a hundred million dollars, let me tell you, I've been on those projects before. Completely different from residential. And they do that because there's more at stake for the owners. But in residential, we should be treating it the same way because you know, 10 grand that we're scammed and can't get back may feel like $10 million, especially because you trusted that person.
I'm so really genuinely appreciative to be here because I'm like, I love it when consumers speak up because it's important for us to flag. Otherwise, those things keep happening. I mean, two neighbors didn't even know it. I'm like, how did this happen?
How to Stop the Construction Project and Rehire the Contractor?
Michael: What are the mitigation scenarios that the consumer may have by stopping the project and rehiring?
Matt: One thing I didn't mention, and I think we should, is the payment schedules. You really want to lump your payment schedule, so your terms of payment, to very clear, tangible goals.
I always say in the book, anytime you can lump it to an improved inspection, do that. So you want to ask, "Hey, is there a permit here?" Great, there's a permit. What are the inspection intervals? Well, they're going to come out when you've rough-framed the walls, right? They're going to come in when you've installed the installation. You want to install those payments and I'll get back to why this is important to what you just asked.
...that's really important to tie them to clear tangible goals and goals that are specific.
So I tie in concrete a payment to poured concrete and approval of the finish. A lot of contractors tie payment to the installation of the forms. Well, I don't care about the installation of the forms if I'm a consumer. What does that mean? I don't know what it's supposed to look like. If it's good, if it's bad, I'm not going to pay you for that. I don't know how to go out and check and see if you sloped it correctly. But I can tell you if the concrete looks bad, right?
You want to have as many tangible, specific goals. And the reason for that is because if you end up having to switch contractors, you want that split to be in your favor, right? You want to be able to come out and say, "I don't like this concrete. I'm not paying you." Right? You can't do that if you've paid them on the form work. So really thinking through how you set up your terms of payment is crucial.
I know good contractors that will take a project and move it forward. It's really about transparency as to why things went wrong. Like for example, if I'm coming out to do an estimate and a client were to show me, "Hey, here's the schedule I had," right? North star approach. I have my schedule. It took them four weeks to do this. So I had to let them go. I know right away, the client's organized, they're professional, and they didn't do something to which a good contractor left.
Because the good contractors are worried about, well, was the consumer doing something that scared the contractor away? Am I walking into an issue? So I see it from both ways, right, growing up in the industry the way I did.
I always tell consumers… explain and be honest as to why that contractor didn't work out.
That's helpful. In terms of mitigation or stopping your losses. Referring to the payment schedule is huge. And you have to set a precedent with a contractor that's not working in your favor as fast as possible. I call it the cookie trail. Okay?
I've had literally hundreds of clients over the years that we've gone back and done work, fixed work, right? And every single one of them, when we start talking about what got them to this point so that I can understand. Before I can fix it, I have to understand. So we started talking about, well, what happened?
The line of cookie crumbs starts to come out. It was like, "Well, he was late when I first called him, and then the second appointment, it was his wife, and she didn't know who I was, who answered the call.” And then it was, "Well, I got a lien request from the concrete vendor or the wood vendor, but he told me."
It was like, there's all these signs, these indications. Very rarely, unless it's stealing money on the front end, very rarely is it just this one big instance that happens. Very rare in my opinion. So I know a lot of consumers, it takes a lot to get them pissed. Right?
And it builds up. And so it's kind of this, like, "I'm going to let it go. He was a little late. I'm going to let it go. They didn't call me back. I'm going to let it go. Yeah. They needed more money, but it seemed like. I'm going to let it go, let it go, let it go." And then all of a sudden it's like you're like, "No more."
I tell consumers to do the opposite. I say, "Look, be stern in the beginning and forgiving in the middle and end because you want it to set a precedent that you are not the person to mess with." And you can do that in a way that's respectful and mutual.
I'm not saying to be mean to the contractor. But if he's an hour late, let him know. "Hey, look, I understand things happen, but it is very important to me that you communicate. I don't want to see this happen again. I'm working my schedule around what you're doing in my home. And it's important for us to communicate."
Setting boundaries and standards are really important
And that's your biggest strength, I think, as a consumer is to not let these little things go because contractors, the non-ethical ones, can sense who they can take advantage of and who they can't. They're not stupid in my opinion. So the more you can set yourself up as not being the target, the better the process becomes. Even if they had the intention of doing it, they may realize, well, they asked for a schedule, there are payment terms. And if you can't work through some of these reasonable changes, they're not your person.
I think obviously the whole undercover contractor thing that started with me really, I was helping a lot of friends and family members, right? So I was this contractor, but I would show up as the cousin, or the friend, or the nephew, and negotiate and help out. I had somebody tell me, "You're kind of like this undercover contractor, like you showing up as my friend. And you're like giving me advice and whatnot."
And so, that's where my passion lies. I would say to consumers, there are good contractors. There's a lot of people that get into this industry because they love it, and it's what they know and they love. But there's also a lot of money to be made right now. And so you're in this very weird and interesting time where you can make a lot of fast money if you're not ethical. And yet still there's a lot of people who truly love what they do, and will treat your home as if it's their home.
So it's just important to do the extra work of sifting through and using a system. That's why I said, find, vet, hire, manage. I want to give a framework. The confident homeowner system is about you really arming yourself with the tools in making the investment because the odds are not in your favor in my opinion, and looking at the statistics of how many homeowners have had issues, can talk about consumer complaints.
The odds are not in our favor if we just rush this and put all the trust and faith in the contractors. It's just not. And that's really what I'm about is saying, "Look, I'm not here to say that every contractor's bad." I'm here to say there are enough people that aren't great to where you really need to slow down a little bit and think through this process because the risk is high and you don't want to have all your trust and faith in just the contractor.
But it's not to mean that it can't be fun. It can't be enjoyable. It can't be a pleasurable experience. It's just you're the one who's going to be your best advocate. In commercial construction, you have an owner's rep. So not only do you have a general contractor, you have an owner's representative making sure everything that's being done is done fairly.
You have to be your own owner's rep and it's unfortunate and it's more work. And I know we like to think that if we pay a contractor, they should do this, but it puts a little bit too much trust and faith sometimes in one person. And you have to really arm yourself with the tools.
Michael: I would like to thank you for this interview.
If you plan to build a house or have already hired a contractor and started the construction process, consider the above tips to avoid mistakes and scams with contractors. As our home construction expert says, “Setting boundaries and standards are really important and that's your biggest strength.”
If you have questions or comments concerning the home building and remodeling process, construction companies, and general contractors, please share them below. You are also welcome to leave a review about your experience with home construction.
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