Send the same brief before collecting prices
Give each bidder the same drawings or measured description, product decisions, scope boundaries and access information. Identify owner-supplied products and the work another contractor will perform. Record the version and date so an updated drawing does not accidentally reach only one bidder. Invite written questions and share material clarifications with all three.
The FTC recommends three written estimates along with checking the businesses and reviewing a written contract. Three is a comparison method, not a national legal requirement or proof that every bidder is qualified. If you receive very different prices, find the scope, assumptions and commercial arrangements behind the difference before asking everyone to match the cheapest total.
Check the kind of number being offered
| Term or feature | Question to ask |
|---|---|
| Fixed price for defined work | What documents and exclusions define the agreed result? |
| Estimate | What can change it, and how will the price be established? |
| Cost-plus or time-and-materials | What rates, markups, records and approval limits apply? |
| Product allowance | Is it supply only or delivered and installed, and what tax and markup are included? |
| Unpriced condition | What investigation or agreed process will establish the work and cost? |
A fixed-price proposal and an open-ended labor estimate are not equivalent promises because their first-page totals are similar. Ask for enough written detail to understand the risk each puts on the owner. Record which amount is firm, which remains a selection allowance and which is not included at all. If a structural question is unresolved, do not invent a small allowance merely to make the comparison look complete.
Normalize a defined example before ranking
| Adjustment | A | B | C |
|---|---|---|---|
| Opening offer | 28,500 | 31,400 | 29,900 |
| Fixture allowance adjustment to $4,000 | 2,500 | 500 | 0 |
| Missing disposal | 700 | 0 | 0 |
| Missing protection | 500 | 0 | 0 |
| Missing permit administration service | 200 | 0 | 0 |
| Excluded painting now included | 0 | 0 | 1,200 |
| Comparable clarified offer | 32,400 | 31,900 | 31,100 |
A included a $1,500 fixture allowance; replacing it with $4,000 adds $2,500, not another $4,000. B’s $3,500 allowance increases by $500. C already included $4,000 but excluded $1,200 of painting. After the stated clarifications, A is $1,300 above C rather than the cheapest. B is $800 above C. The original order of the bids no longer describes the same finished work.
Turn the comparison into each bidder’s confirmed offer
A homeowner’s comparison sheet does not amend a contractor’s proposal. Send the relevant clarification back to each bidder and request a revised written offer identifying its scope, price and remaining exclusions. If the bidder cannot confirm a required operation, mark it unresolved rather than treating your own estimate as their commitment.
The permit-administration adjustment in the example is a contractor service, not a municipal fee. Keep those two costs separate when completing the household funding plan. Likewise, do not compare one offer including owner purchases with another excluding them. State the tax basis explicitly: California’s tax guidance illustrates that treatment depends on the supplied items and contract arrangement, not simply on a U.S.-wide percentage.
Evaluate the business as carefully as the scope
- Check the exact contracting business and the licenses required for its work in your jurisdiction. A name on a truck or a trade worker’s credential may not identify the entity making the contract.
- Ask for relevant recent projects and references, then discuss how changes, communication and completion were handled.
- Confirm who supervises, which trades are used and whether those services are included.
- Review insurance evidence and verify the relevant coverage through appropriate channels.
- Assess whether the proposed schedule fits actual product availability, permit steps and household access.
A complete lower bid can still be unsuitable if the contractor cannot perform the required work or the commercial terms create unacceptable uncertainty. A higher price is not evidence of better workmanship either. Keep written reasons for the choice: confirmed scope, competence, communication, payment terms and price.
Use state rules for the state where the work occurs
The California CSLB contract guidance requires detailed written terms and signed written changes before the changed work. That is a California example. Elsewhere, check your state regulator and local requirements for licensing, contract notices, payment limits and cancellation rights. Do not assume that a general statement about a three-day cancellation period covers every signing situation.
For ordinary covered California home-improvement contracts, the general down-payment limit is the lesser of $1,000 or 10% of the contract price. CSLB’s consumer guide also identifies a qualifying blanket-bond exception for certain licensees; verify any claimed exception. A request for a large “special-order” deposit should not be accepted simply because a product is custom-made.
Agree on the version you will manage
Before signing, connect the selected price to the drawings, specification, allowance schedule and exclusions you actually reviewed. Confirm the completion basis, responsibility for permits, selection deadlines and payment milestones. Resolve contradictions between a sales email and the contract instead of assuming the more favorable wording will control later.
CSLB’s contracting guide illustrates how allowances and written additions or deductions connect to the contract. Keep a dated original and a separate register of approved changes. Reno Pro or a spreadsheet can support that record, but entering a number does not establish the contractor’s consent. A useful comparison ends with a clear agreed package and a manageable list of remaining decisions.
Sources and scope
- Federal Trade Commission — Home repair scams
- California Contractors State License Board — Learn about home improvement contracts
- California Contractors State License Board — Terms of Agreement: consumer contract guide
- California Department of Tax and Fee Administration — Construction contractors: industry topics
- California Contractors State License Board — Contracting for Success
Sources reviewed on 18 October 2026. Dollar amounts are USD. Worked budgets, reserves and scheduling examples are editorial illustrations, not local bids, national price averages or prescribed allowances. State and city examples are identified; requirements depend on the property, contract and jurisdiction.