Home Buying in 48910>Question Details

Helpme, Home Buyer in 48910

Do I need a licensed contractor when using a FHA 203k streamline loan?

Asked by Helpme, 48910 Mon Apr 30, 2012

I was looking to hire an independent contractor to work on a house I'm waiting to close on, he is a licensed contractor but his company is not and he works by himself. So he has no insurance. Thanks in advance.

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4
No insurance? The uninsured contractor leaves a power saw energized and operational and in a location where the neighbor's toddler finds it.....or the uninsured contractor negligently starts a fire that burns your neighbor's garage...or the uninsured contractor not so bright helper digs up the gas line, forcing an evacuation of the area. Guess who's paying the damages? Not the uninsured contractor! Why not act in a smart and morally acceptable manner and hire a qualified and licensed contractor? The small amount of money you save by hiring Eb from Green Acres to perform the necessary improvements isn't worth the risks.

You state that "I was looking to hire an independent contractor to work on a house I'm waiting to close on" Does the owner of the property know you are working on the property prior to title passing? He could be liable for damages caused by the uninsured contractor.
0 votes Thank Flag Link Fri May 4, 2012
This will be an answer best received from your loan officer. The items which do not require license (painting, etc.) would require at a minimum a liability insurance policy but your loan officer would best answer that.
0 votes Thank Flag Link Mon Apr 30, 2012
Yes. The contractor is supposed to be licensed and insured. FHA has some rules that need to be followed. The loan officer you're using should know all the details.
0 votes Thank Flag Link Mon Apr 30, 2012
I would recommend only hire someone who is licensed and insured.
0 votes Thank Flag Link Mon Apr 30, 2012
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