Selecting the right service provider for your homeowner’s association’s (HOA’s) maintenance and improvement projects is an important responsibility. The wrong choice can potentially lead to poor workmanship, legal issues, and unhappy residents. To help your board make informed decisions, here are eight things to watch for when evaluating potential service providers.
1. Lack of Proper Credentials
Before hiring any service provider, confirm they have the appropriate licenses and permits for the work they’ll be doing. This ensures they meet industry standards and comply with local regulations.
- Why it matters: Without proper credentials, your association could be liable for accidents or code violations.
- What to check: State or local licensing, trade certifications, and any required permits.
Tip: When requesting bids, the job specifications and Request for Proposal should include a requirement for the information needed to qualify the service provider, as noted in this article.
2. Refusal to Provide References
A reputable service provider should be proud to share references from past clients. If they won’t, it’s a major red flag.
- Why it matters: It could indicate a history of poor performance or unresolved disputes.
- What to do: Ask for at least three references and follow up with each one.
3. No Proof of Insurance
Insurance is essential when service providers are working on community association property. It protects your community from liability in case of accidents or damage.
- Minimum requirements:
- General liability insurance
- Workers’ compensation insurance
- Ensure adequate limits of coverage (beyond minimums required by the state), depending on the work being done
- Tip: Always request a certificate of insurance and verify that it’s current and adequate. Include a requirement in the final contract specifying that insurance must remain in force throughout the duration of the work.
4. No Experience with Community Associations
HOA projects often involve multiple stakeholders, strict timelines, and community-wide impact. Service providers who aren’t familiar with this environment may struggle to meet expectations.
- Why it matters: Community association projects require clear communication, flexibility, and an understanding of community dynamics.
- What to ask: Have you worked with HOAs before? Can you provide examples?
5. Unprepared or Disorganized
A professional service provider should come prepared to assess the project and provide thoughtful input.
- Red flags:
- No clear plan or timeline
- Vague or incomplete quotes
- Inability to answer basic questions
- What to expect: A walkthrough of the property, a discussion of goals, and a detailed proposal.
6. Suspiciously Low Pricing
If a quote seems too good to be true, it probably is. Low bids can signal hidden costs or subpar work.
- Possible reasons:
- Use of low-quality materials
- Lack of insurance
- Inexperienced labor
- What to do: Compare multiple bids and ask for a breakdown of costs.
7. No Written Contract
A written contract is essential to protect both your association and the service provider. It outlines expectations and provides legal recourse if things go wrong.
- What it should include:
- Scope of work
- Payment terms
- Deadlines
- Insurance requirements
- Tip: Never start work without a properly executed agreement.
8. You Have a Bad Gut Feeling
Sometimes, your instincts are your best guide. If something feels off, it’s okay to walk away.
- Trust your gut if:
- The service provider is evasive or overly aggressive
- Their promises seem unrealistic
- Communication feels uncomfortable
Take the Guesswork Out with CAMS’ Trusted Service Provider (TSP) Program and Property Management Advantage Program (PMAP)
At CAMS, we know how challenging it can be to find reliable service providers. That’s why we offer our Trusted Service Provider (TSP) Program to all clients. This program simplifies service provider selection by:
- Inviting only vetted, reputable service providers to participate
- Obtaining competitive bids on your behalf
- Verifying insurance coverage and credentials
- Ensuring service providers meet CAMS’ high standards for service and reliability
With the TSP Program, your board can focus on making decisions, not chasing paperwork or worrying about service provider quality. And when the project involves more than ordinary maintenance, PMAP will provide valuable expertise to assist the association.
Conclusion
Choosing the right service provider is about more than just a price; it's about protecting your community and ensuring quality work is done. By watching out for these red flags and leveraging resources like CAMS’ Trusted Service Provider Program and Project Management Advantage Program, your board can make confident, informed decisions that benefit your entire community.
About Community Association Management Services
In business since 1991, CAMS has grown to become North and South Carolina’s premier community management company. With experienced local managers in each of its nine regions, CAMS provides innovative solutions to the community associations it serves. To learn more, visit www.camsmgt.com/choose-cams.
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