This comment on our website from a homeowner got my attention:
I have a situation where I contacted a licensed contractor to install a bathroom and wet bar in a rumpus room. He came out and walked the area and then asked if I was planning to pull permits. I said yes, that was my intention. He proceeded to tell me if I wanted permits it would be one price, however he could do it without for a different price. That seems to confuse me, after all the job isn’t changing. Needless to say, I will not go with him, as it seems fishy. But I’m curious has anyone come across this scenario, and if so, why the difference??
When a contractor doesn’t want to get a permit, there’s always a reason. They might want to save the owner money, believing part of their job is to help manage the owner’s finances. They might want to start the job without waiting for the permit process, which in some cases can take months waiting for plan checks. Worst case, they are either unlicensed or uninsured and know that the permit will be denied.
I appreciate that this homeowner recognized the problem and was savvy enough to avoid the contractor. In my experience, the request usually goes the other way, ie, the homeowner asks the contractor to not get permits in order to save money. I’ve walked away from jobs where the customer didn’t want a permit. Where we live, you can have your license yanked by the state working without a permit, and I suspect many of you live under the same rules. I wouldn’t put my business license and future in jeopardy because a home or business owner wanted to be cheap.
There are other risks. If a job isn’t permitted, and the home or building owner later wants more work done, the inspector can red tag the job if he can’t find a permit for the previous work. That will shut the job down while the owner scrambles to figure out what was done and by whom. Along with the trouble involved, it also can result in a lot of extra expense if the work wasn’t done to code and has to be torn out. Work that was unpermitted can also cause serious issues in case of an insurance claim or during a sale.
The primary purpose of a building permit is to give the local governing agency a way to make sure the work is done correctly. It provides protection for the home or building owner. When you get a permit for the work, you have a standard to build to. You may not agree with the standards or like them, but they’re there for a purpose. With a permit, you have a third-party opinion that the work is at least being done to the local building department code.
I have had more than one owner tell me they know enough about construction to tell if the job is being done right. Sure they do. And pigs will fly tomorrow.
Does the process always work? Of course not. I know that permits can also serve as a money-making machine for the local governing agency. In many areas, permits have become more expensive, are harder to obtain, and the quality of the inspections have declined.
Until contractors as a group make enough noise to the city, country or parish governing agencies that oversee the permitting process and improve the process, we’re stuck with what is in place. If we educated the public and voted as a group to replace those in charge, the situation might improve. Until then, this is what we have.
As a side issue, it’s not unusual for a general contractor to send the owner to get the permits, or for the owner to offer to pull permits. The risk to the owner is that the contractor might be asking you to pull the permit because of license or insurance issues. The risk to the general contractor is that the permit the owner requests may or may not match the work the contractor agreed and contracted for. The one who is doing the work should be the one who gets the necessary building permits.
For many years I arbitrated disputes on construction-related projects. One of the first things I looked for was whether permits had been pulled for the work done. If not, my antenna that detects flaky contractors went up and warning flags started waving. Good contractors, ones I’d call A or B list contractors, always get the required permits. Those who don’t almost always fall into the C or D list of people in this business. We define A, B, C and D list contractors in this article.
I understand wanting to avoid pulling a permit when it’s required, but it’s not a smart move. Do the right thing even when it’s difficult; you’ll sleep better.
The knowledge and experience Michael Stone gained in his 60+ years in construction has helped thousands of contractors improve their businesses and their lives. He is the author of the books Markup & Profit Revisited, Profitable Sales, and Estimating Construction Profitably, and is available for one-on-one consultations.
Listen to the audio here, or select the dots on the right to download:
wpDiscuz