Choosing a builder is not just about who gives the best quote or the friendliest first impression. It is about verifying that the business behind the quote is real, insured, financially stable and willing to put its promises in writing. Most disputes and unfinished jobs trace back to a step that was skipped at the start — no written contract, no insurance check, no clear payment schedule. This guide sets out the practical checks worth making before you hand anyone a deposit, and what a fair contract and payment structure should look like.
Verify the business exists properly
Before anything else, confirm the builder is a genuine, traceable business rather than a cash-in-hand arrangement with no fixed address. A company number, VAT registration if applicable, a landline or established trading history all suggest permanence. A builder who has been trading locally for years under the same name has a reputation to protect, which matters more than any single review.
- Check Companies House if they trade as a limited company
- Ask how long they have operated under the current business name
- Look for a genuine trading address, not just a mobile number
Insurance is not optional
Public liability insurance covers damage or injury caused during the works, and any builder working on your home should hold it as standard. Ask to see the certificate rather than taking it on trust, and check the level of cover is reasonable for the scale of your project. If subcontractors are used for steelwork or electrics, check they carry their own cover too.
References worth actually checking
A reference is only useful if you follow it up properly. Ask for jobs of a similar scale to yours, ideally finished within the last two years, and ask the previous client direct questions: did the price match the final bill, did the team turn up when they said they would, and would they use the same builder again. A builder confident in their work will not hesitate to arrange this.
- Ask for at least two references from similar-sized projects
- Visit a finished job in person if the client is willing
- Ask specifically about communication during delays or problems
A written contract, every time
Verbal agreements cause more disputes than almost anything else in domestic building work. A proper contract, even a simple one, should state the scope of work, the specification, the price, the payment schedule, the approximate programme, and what happens if extra work is needed. JCT Homeowner Contracts are a recognised standard template for this and are worth using or referencing on larger projects.
Red flags versus green flags
Some warning signs are obvious once you know to look for them, while genuinely trustworthy builders tend to show a consistent set of reassuring habits. The table below sets out common signals in both directions.
| Signal | Red flag | Green flag |
|---|---|---|
| Payment request | Large deposit demanded up front, in cash | Modest deposit, staged payments tied to work done |
| Contract | Refuses to put anything in writing | Offers a written contract unprompted |
| Insurance | Cannot produce a certificate | Certificate available on request, in date |
| References | Vague or reluctant to provide any | Offers recent, similar-scale references |
| Quote detail | One-line total with no breakdown | Itemised quote covering labour, materials, fees |
| Availability | Can start next week on a large job | Realistic lead time, booked diary |
These are general indicators, not guarantees. Always combine several checks rather than relying on any one signal alone.
Staged payments protect both sides
A fair payment schedule releases money as work is completed, so neither party is carrying excessive risk. Paying the full amount up front leaves you exposed if the builder does not return; refusing to pay any deposit at all can also be unreasonable, since materials often need ordering before work starts. Typical structures for a mid-sized project are shown below.
| Stage | Approximate share of total | Triggered by |
|---|---|---|
| Deposit | 5–10% | Signing the contract, materials ordering |
| Groundworks/structure complete | 20–25% | Foundations, steelwork or shell complete |
| First fix complete | 20–25% | Plumbing, wiring and insulation in place |
| Second fix and plastering | 20–25% | Plaster dry, kitchen/bathroom fitted |
| Final payment | 10–15% | Snagging list cleared, final sign-off |
Figures are indicative and vary by project size, region and builder. A written schedule specific to your job should be agreed before work starts.
Reading the small print on materials and warranties
Check whether the quote specifies exact products or just generic descriptions such as 'standard windows'. Vague specification wording is where costs creep upward later. Also ask about warranties on workmanship separately from manufacturer warranties on materials, and whether any structural work will be covered by an insurance-backed guarantee, which matters if the builder is no longer trading in future.
What happens if things go wrong
Even with good checks, disagreements occasionally happen. Agree up front how variations, delays and disputes will be handled — ideally in writing within the contract — so there is a clear process rather than a confrontation if something needs resolving partway through the job.
Retention and holding back final payment
A retention is a small percentage of the contract value, commonly 2.5–5%, held back beyond practical completion and released once any snagging items have been fixed, usually after a defined defects period of a few weeks to a few months. It gives you leverage to get minor faults addressed without withholding the whole balance, and a reasonable builder will not object to a modest retention being written into the contract, provided the release trigger and timescale are clearly defined rather than left open-ended.
Formal routes if a dispute cannot be resolved directly
Most disagreements are settled by simply talking it through against the written contract, but if that fails there are established formal routes rather than going straight to court. Mediation, where an independent third party helps both sides reach a compromise, is faster and cheaper than litigation and is often built into JCT Homeowner Contracts as a first step. Trade body schemes such as FMB or TrustMark-affiliated conciliation services can also help, and for larger disputes adjudication or the small claims court remain available, though these are best treated as a last resort after other routes have been tried.
- Keep every email, variation and instruction in writing as you go
- Raise concerns as they happen, not weeks later
- Check whether your contract names a specific dispute procedure before work starts