Homeowners Beware!

This page is dedicated towards providing industry information, definitions, programs, and other positive support.

Homeowners are not fully protected by the State of Florida when hiring a licensed contractor. For instance, even though the contractor is licensed and carries applicable insurance coverage, the homeowner is still susceptible to financial loss. Let me explain. In commercial and public construction contracting, the contractor may be required to purchase a bid bond, performance bond, or payment bond. These bonds provide a variety of protections for big dollar contracts, but not for the little ones. In other words, the homeowner has little protection compared to commercial and public contracts. Thus, the homeowner can still lose their deposits, have contractors walk away from the job, have a lien placed on their home, or experience "shoddy" work, with no-true resolution.

• Solution: The homeowner must be vigilant in their search for a qualified contractor and must be thorough in their overall investigative process. The state is a resource for recording complaints, but does not provide/promote the same guarantees for service completion, standardizing bid price, and payment for services (contractor, subs, vendors, etc) as required for commercial and public contracts. The bottom line: Good Luck!

I have spent many hours researching homeowner "safety nets" when it comes to contractor use and my conclusion is as follows: protect yourself, protect yourself, protect yourself! 

What types of work do not require a state license?

• Cabinets, countertops, flooring, paint, wallpaper and window treatments, do not require a state license.

Surety Bond Basics

A surety bond is not an insurance policy. A surety bond is a guarantee, in which the surety guarantees the the contractor, identified as "principal" in the bond, will perform the "obligation"  as stated in the bond. Examples are the following:

• Bid Bond-The principal will honor its bid.
• Performance Bond-The principal will complete the project.
• Payment Bond-The principal will properly pay all subcontractors and suppliers.

If the principal fails to perform the obligation stated in the bond (i.e., bid, performance, payment,), both the principal and the surety are liable on the bond (joint and several-either party separately or together may be sued).

Recovery Fund

There exists a Recovery Fund that is offered through the State of Florida. However, in order to take advantage of this fund, the requirements are extensive and time consuming. Below are a few highlights of the program: The construction industries "Recovery Fund" (Florida Homeowners' Constructionh Recovery Fund) is a fund of last resort that is available for individuals who have experienced monetary damages through the mismanagement or misconduct of a contractor, and who has exhausted all other resources of payment. For contracts entered into after January 1, 2005, the fund is restricted to homeowners only and is limited to contracts entered into with Division 1 Contractors:

• General Contractor
• Building Contractor
• Residential Contractor

Division 2 Contractors (not covered)

• Sheet metal contractor
• Roofing contractor
• Class A air-conditioning contractor
• Class B air-conditioning contractor
• Class C air-conditioning contractor
• Mechanical contractor
• Commercial pool/spa contractor
• Residential pool/spa contractor
• Swimming pool/spa servicing contractor
• Plumbing contractor
• Underground utility and excavation contractor
• Solar contractor
• Pollutant storage systems contractor
• Specialty contractor (specialist)

The Construction Industry Licensing Board makes the determination of eligibility for an award. 

Let us help you minimize your risks and optimize your satisfaction! Refer to the Homeowner Survey Form or contact us at Simply Do Your Job .