First, if the cost of the work totals $30,000 or more, the contractor must be licensed. Get their license number and check it out at www.contractors-license.org.
Also, ask for proof of insurance. Make sure the contractor carries general liability insurance and workers' compensation. If the contractor is not insured, the home or business owner may be liable for accidents that occur on the property.
It's also useful to talk to previous customers to see if they're satisfied with the work.
Get several written estimates and compare services and prices, the cheapest quote isn't necessarily the best.
Insist on a written contract that clearly states all work with a payment schedule along with who's responsible for getting the required permits.
When it comes to guarantees, get them in writing with how long the guarantee is valid.
When it's time to pay for the work, pay by check and never pay in full until the work is done and you're happy with it.
Also, watch out for brokers who promise so-called "guaranteed" loans from FEMA, especially if they ask for an up-front payment. FEMA does not charge an application fee. Verify the credentials of people offering low-interest government loans and contact the agency directly to verify it's legit.