Having the wrong contractor can become a significant source of frustration and financial loss. There are a plethora of stories recounting the horrors of having a contractor doing a simple job that resulted in a fiasco. For property owners in Colorado, it can be a tricky business of finding the right contractors.
Every state has different rules and regulations that dictate what contractors must have to conduct business. It is important to know what is required before commissioning someone to fix a property. Licensed, Bonded and Insured seem self-evident for hiring a contractor, but what exactly do they cover and how do they help the property owner?
Below is a brief overview of the three with links to websites with additional insight.
When a contractor is bonded, this means they have purchased a surety bond. This is a type of insurance policy that protects a property owner. The bond provides a certain amount of liability protection. If the contractor fails to complete a job as required or contracted, the bond can provide compensation to a property owner.
- Colorado has no state license for general contractors. Licensing resides at the municipal level if required
- Required to have a business license.
- Electricians and plumbers require state-level licenses.
- Licenses are needed in Denver and Arvada.
Commercial Liability Insurance is not mandatory for businesses operating in Colorado. Colorado is a fault state. However, as a rule, most small businesses should have coverage between $500,000 and $1 million.
Contractors are a significant component of ensuring that rental properties are maintained and in livable condition.
Trusted, experienced and reputable contractors that complete work on time and within budget aren’t challenging to find; but they are usually harder to schedule. General speaking, they are bonded, licensed and insured correctly and in high demand. Having a property management company can help in finding this type of quality contractor.
We’re here to make the investment and rental process more pleasant and less expensive. Contact us at Blue Mountain Real Estate & Property Management today. We’d love to tell you more.