A general contractor manages your entire project — choosing the wrong one can cost you thousands and months of your life. Here's how to hire correctly.
Typical Cost Range
GCs typically charge a fee of 15–25% on top of subcontractor and material costs, or bid projects as a fixed price. Major remodels: $50,000–$300,000+. Home additions: $100,000–$400,000+.
Licensing Requirement
Most states require general contractors to hold a state license. Some states (Texas) license GCs at the local level only. Others (California, Florida) have strict statewide licensing. Verify at your state contractor licensing board. GCs should carry general liability and workers' comp for their entire crew.
A general contractor (GC) manages the entire construction or renovation project: hiring and coordinating subcontractors, pulling permits, sourcing materials, maintaining the schedule, and serving as your single point of accountability. For any project involving multiple trades (kitchen remodel, room addition, whole-home renovation), the GC is the most important hire you'll make. Most states license general contractors — verify carefully.
Asks for more than 30% upfront before materials are ordered
Can't provide a license number or whose license lookup shows expired or inactive
Won't provide a line-item breakdown — only a single lump-sum number
Uses vague contract language like 'standard materials' or 'similar quality'
Has no written change order process — 'we'll figure it out as we go'
Won't provide references, or references don't answer/give vague answers
Proposes to skip permits 'to move faster'
Is juggling 10+ projects simultaneously with no dedicated project manager for yours
Provides a detailed written contract with specific materials, allowances, payment milestones, and timeline
Has a formal written change order process with pricing agreed before work proceeds
Provides references from similar-sized projects who will give detailed accounts
Pulls all permits and manages the inspection schedule without being asked
Has a dedicated project manager or superintendent on site daily
Uses the same trusted subs consistently — relationships with quality subs are a major competitive advantage
Carries adequate insurance and will add you as additionally insured during the project
Are you a licensed general contractor in this state? License number?
Do you carry general liability ($1M+) and workers' compensation insurance?
Will you be on site regularly, or will a project manager run the job?
How do you handle subcontractor selection — do you use the same subs regularly?
Will you pull all required permits, and how do you handle the inspection schedule?
What is your payment schedule, and how are change orders handled?
Can you provide references from 2–3 projects similar in scope to mine, completed in the last 2 years?
How many projects are you currently managing?
What happens if the project runs over budget? Over schedule?
Who is my point of contact for daily questions during the project?
Define your project scope in writing
Before you contact contractors, create a written scope document describing the project in detail. Include a rough budget range. This lets contractors bid accurately and prevents scope creep.
Get 3+ bids on an identical scope
All bids should cover identical work so you can compare apples to apples. If scopes differ, ask each contractor to revise to match. Bids that are dramatically lower are usually missing scope items.
Verify license, insurance, and references
Check the GC license at your state board. Request a COI (certificate of insurance) naming you as additionally insured. Call all 3 references and ask specifically about budget adherence, timeline, communication, and how they handled problems.
Negotiate a thorough contract
The contract must specify: exact scope of work, specific materials, payment schedule tied to milestones, change order process, dispute resolution, timeline with substantial completion date, and warranty terms.
Set up communication expectations
Agree upfront on communication method (text, email, weekly meetings), update frequency, and who your primary contact is. Projects without a defined communication process run longer and cost more.
Monitor the project without micromanaging
Visit the site regularly. Document everything in writing. Pay on milestone completion — not on time pressure. Hold 5–10% of the contract price until the punch list is fully complete and permits are closed.
How much do general contractors typically charge?
GCs typically charge a fee of 15–25% on top of direct costs (subcontractors, materials, permits). On a $200,000 renovation, that's $30,000–$50,000 in GC fees. This covers project management, coordination, warranty liability, and their business overhead. Fixed-price contracts are more common for defined-scope projects.
What's the difference between a GC and a handyman?
A licensed GC manages multiple trades, pulls permits, carries substantial insurance, and is legally accountable for the work of everyone on the project. A handyman typically handles smaller, single-trade tasks. For any project requiring permits or multiple trades, hire a GC.
How detailed should the contract be?
Very detailed. Every material should be specified by brand, model, and grade. Every exclusion should be explicit. Every allowance should be realistic. The more detail in the contract, the fewer disputes during the project. A GC who resists detailed contracts is protecting their ability to make changes later.
What is a construction lien, and how do I protect myself?
A mechanic's lien is a legal claim that a subcontractor or supplier can place on your property if they weren't paid by the GC. To protect yourself: require lien waivers from the GC and all major subs at each payment milestone. A joint check agreement (co-writing checks to the GC and major subs together) provides additional protection.
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Request estimates for your project, then review each general contractor's credentials, experience, references, and written terms before hiring. Availability and credential status vary by profile.
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