What Happens to My Project If My Contractor Closes Due to the Recession?

We’re nearing a recession; therefore, what happens to your projects if your contractor closes? Keep reading to find out. 

During the COVID-19 pandemic, the world economy suffered greatly. Moreover, while rehabilitation attempts were ongoing, the Russia-Ukraine conflict exacerbated the issue. Because these events are projected to have a long-term influence on the global economy, many experts predict a recession in 2023. But what does this mean for the home improvement industry? That’s simple: There will be a decline in remodeling and construction jobs and projects, as well as a decline in companies. However, what happens to your project if your contractor closes due to this incoming recession? In this guide, we go over four scenarios and some helpful tips to overcome them or avoid them altogether. 

Here’s what happens. 

Production Stops

The first thing that happens when your contractor closes due to the recession is that production stops altogether. If you are still in the planning phase of the job, then the good news is that you may not have paid anything or started any interior or exterior work; therefore, you shouldn’t have any problems if they close. However, are you ready for the bad news? If the contractor is in the middle of the work, the team will come to a complete stop, meaning that your project will stay in that step until you, your contractor reopens or a new company takes over. When this happens, it will push back your schedule as well as create additional stress. 

You May Not Get Any Money Back

Depending on the type of contract you sign as well as if your contractor is insured, bonded and licensed, you may not get your money back from the initial deposit. That is why you have to be mindful and thoroughly read any contracts you may sign with a company. We recommend working with a company that is licensed, insured and bonded so that if they close and refuse to refund you, you can take them to court to receive your money back for any work that was not done. You may have issues arise if you work with a handyman. Many handymen do not have to be licensed, insured or bonded, meaning they can close without having to worry about any legal charges. While you can work with them, we recommend having a solid contract with them in case the recession shuts them down. 

There May Be Dangerous Parts Still Exposed

If you had a contractor in the middle of production, you may have piping, electrical elements and holes still exposed, creating dangerous sections of your home. With these exposed elements, you increase the chances of you, your children and your pets getting harmed. In most cases, the only way to close these areas up is with professional help. Typically, when everything is still exposed, it is most likely turned off, making it so that you cannot use your electricity or plumbing for the time being. And when your contractor closes and never comes back, who turns these features back on? 

You May Have a Hard Time Finding a New Contractor

Guess what is happening during a recession — many other companies are falling under. Therefore, you may have a hard time finding a new contractor to finish the project. Plus, there are even companies that are not comfortable completing projects that have already been started. This leads to many homeowners being stuck with completing their projects on their own or hiring an underqualified or untrustworthy contractor. Do not let this happen to you. Instead, work with a company that knows it can last through a recession as well as will take on work for any homeowners that had a previous contractor close on them. Whether you need to find a new contractor or want to go with the top local stress-free remodelers from the get-go, Valor Home Services is ready to help. Let’s get you on the schedule by calling our team