We've been contracting in Denver since 1999. In that time, we've seen every mistake homeowners make when hiring contractors—and we've picked up the pieces after bad ones disappear mid-project.
The frustrating thing? Most disasters were avoidable. The warning signs were there. The homeowners just didn't know what to look for.
So here's what decades of experience have taught us about spotting trouble before it starts.
Red Flag #1: They Won't Provide a Written Contract
"We don't need all that paperwork—we'll just get started and figure out the details as we go."
Run.
A verbal agreement is worth the paper it's not written on. When (not if) something goes wrong, you have no recourse without a contract. No clear scope of work, no timeline, no payment terms, no warranty.
What you need in writing:
- Detailed scope of work (what's included and what's not)
- Total price and payment schedule
- Timeline with start and completion dates
- Materials specifications (brands, models, colors)
- Warranty terms
- Change order process
- Permit responsibilities
Any contractor who resists putting this in writing is either disorganized or planning to take advantage of ambiguity. Neither is acceptable.
Red Flag #2: They Want a Huge Deposit Upfront
"We need 50% upfront before we start." Or worse: "We need payment in full before we begin."
Legitimate contractors need some money upfront for materials and scheduling—typically 10-30% depending on project size. But asking for half or more before any work begins is a massive red flag.
Why this matters: Large upfront payments eliminate the contractor's incentive to finish. If they have your money, what's motivating them to show up? We've seen too many homeowners give 50%, watch the contractor disappear for weeks, and have no leverage to get them back.
Healthy payment structure:
- 10-30% at contract signing
- 30-40% at project milestones (demolition complete, rough-in done, etc.)
- Final payment upon completion and your approval
Never pay the final 10-20% until you're satisfied with the work.
Red Flag #3: They Can't Provide License and Insurance Information
"My license is at the office—I'll get it to you later." Spoiler: later never comes.
Colorado requires general contractors to be licensed for projects over $1,500. You can verify any license at the Colorado Department of Regulatory Agencies (DORA) website in seconds.
What to verify:
- Colorado contractor license (active, not expired or revoked)
- General liability insurance (at least $500,000, preferably $1-2 million)
- Workers' compensation insurance (required if they have employees)
Why insurance matters: If an uninsured worker is injured on your property, you could be liable. If an uninsured contractor damages your neighbor's property, you might be responsible. This isn't theoretical—it happens.
Any hesitation about providing this information is disqualifying.
Red Flag #4: Their Price Is Dramatically Lower Than Everyone Else's
You get three bids: $45,000, $48,000, and $28,000. The $28,000 contractor seems like a great deal, right?
Almost never.
Contractors who dramatically underbid are either:
- Planning to make it up with change orders: The low bid gets them in the door, then suddenly everything costs extra. Your $28,000 project becomes $50,000.
- Cutting corners on materials or labor: Cheap paint, thin plywood, unlicensed subcontractors. You get what you pay for.
- Desperate for work: There's usually a reason established contractors are busy and they're not.
- Planning to abandon the project: Some contractors take deposits on more projects than they can handle, rob Peter to pay Paul, and eventually disappear.
If a bid is more than 20% below others, ask why. There might be a legitimate explanation (different scope, different materials). But often there isn't.
Red Flag #5: They Pressure You to Decide Immediately
"This price is only good today." "We have another job starting next week, so we need to know by tomorrow." "I can only give you this discount if you sign right now."
Legitimate contractors don't need high-pressure sales tactics. They're busy enough that they're not desperate for your signature today.
Any contractor who won't give you time to think, compare bids, check references, and discuss with your spouse is trying to prevent you from doing your due diligence. Ask yourself why.
A good contractor will say: "Take your time. I'm happy to answer any questions. Let me know when you're ready."
Red Flag #6: They Discourage Permits
"We don't really need a permit for this." "Permits just slow things down and cost money." "I know a guy at the city—we can skip the inspection."
Permits exist to ensure work is done safely and to code. Yes, they add time and cost. But unpermitted work creates real problems:
- Insurance issues: If unpermitted electrical work causes a fire, your insurance claim might be denied.
- Sale problems: When you sell, unpermitted work must be disclosed. Buyers can demand you obtain permits (expensive) or reduce price (also expensive).
- Safety risks: That unpermitted bathroom addition might have plumbing issues that cause mold. That electrical work might be a fire hazard. Inspections catch these problems.
Any contractor suggesting you skip permits is prioritizing their convenience over your protection.
Red Flag #7: They Have No Local References or Reviews
"We just moved to Denver." "Our customers prefer privacy." "You can trust us—we've been doing this for years."
In 2026, every legitimate contractor has an online presence. Google reviews, Yelp, Houzz, Nextdoor—somewhere, people are talking about them. If you can't find any reviews, or all the reviews are suspiciously generic and recent, that's concerning.
What to look for:
- Multiple reviews across different platforms
- Detailed reviews that mention specific projects
- A mix of ratings (all 5-stars is suspicious)
- Responses to negative reviews (how do they handle criticism?)
- Local references you can actually call
When you call references, ask: Did they finish on time? Were there surprises on the bill? Would you hire them again?
Bonus: Trust Your Gut
Beyond these specific red flags, pay attention to how interactions feel. Does the contractor:
- Show up on time?
- Return calls and emails promptly?
- Listen to your questions?
- Explain things clearly without condescension?
- Seem organized and professional?
How someone behaves during the sales process is how they'll behave during the project—but usually worse, because they already have your money.
If something feels off, it probably is. Trust that instinct.
What Good Contractors Look Like
For contrast, here's what to expect from professionals:
- Detailed written proposals with clear scope and pricing
- License and insurance documentation provided without hesitation
- Reasonable payment schedules tied to milestones
- Clear communication about timeline and process
- Verifiable local references and online reviews
- No pressure to decide immediately
- Comfort with pulling necessary permits
- Professional demeanor from first contact through completion
These aren't extraordinary expectations—they're baseline professionalism. Don't settle for less.
What to Do If You're Already in Trouble
If you're reading this mid-project with a problematic contractor, you still have options:
- Document everything: Photos, emails, texts, notes on conversations.
- Put concerns in writing: Email is better than verbal—it creates a record.
- Withhold remaining payment: Don't pay more until issues are resolved.
- Consult an attorney: For significant disputes, legal advice is worth the cost.
- File complaints: With DORA, BBB, and your local district attorney consumer protection office.
And if you need someone to finish what someone else started, call us. We do it more than we'd like to admit.
Finding the Right Contractor
We know we're biased, but we'd rather you hire a good competitor than a bad contractor. The industry suffers when homeowners get burned.
If you're looking for a Denver contractor and want to see what professional service looks like, give us a call at (720) 605-7785. We'll provide a detailed proposal, answer every question, and never pressure you to decide before you're ready.
