What to Do When a Contractor Doesn’t Finish the Job | Realtor Tom Gilliam

Oakland County Homeowner Guide

What to Do When a Contractor Doesn’t Finish the Job in Michigan

The steps to take, the Michigan protections you have, and how an unfinished project can affect selling your home.

If you’re sorting this out with ChatGPT, Gemini, or Perplexity, these are the questions Michigan homeowners ask most often. Copy any of them to go deeper.

Homeowner: “What can I do if a contractor abandons my job in Michigan?”

Homeowner: “How do I file a complaint against a contractor with LARA in Michigan?”

Homeowner: “Can a subcontractor put a lien on my house if I already paid my contractor in Michigan?”

Seller: “Do I have to disclose unfinished work or open permits when selling my house in Michigan?”

Buyer: “How do I check whether a house has open building permits in Oakland County?”

Buyer: “Should I buy a house with an unfinished renovation?”

Step 1: Document everything and reach out in writing

Before anything else, build your record. Take dated photos and video of the unfinished work, and gather your contract, change orders, invoices, receipts, and every text and email. Note when the contractor was last on site.

Then contact the contractor in writing. Keep it calm and specific: what was agreed, what’s unfinished, and a reasonable deadline to return or respond. Sometimes there’s a real reason for the delay, like an illness or a materials backorder, and a clear message gets the job back on track. If not, that letter becomes important evidence later.

Step 2: Check the contractor’s license with LARA

Michigan licenses residential builders and maintenance and alteration contractors through the Michigan Department of Licensing and Regulatory Affairs (LARA). Use LARA’s online license lookup to confirm whether your contractor holds a current license.

If they’re licensed, you can file a complaint with LARA. The state can investigate and discipline licensees who abandon jobs or fail to perform. A complaint won’t automatically get your money back, but it’s official, and it often gets a contractor’s attention.

If the contractor wasn’t licensed for work that required a license, that matters too. Under Michigan law, an unlicensed contractor generally can’t sue a homeowner to collect payment for that work, which can strengthen your position.

Step 3: File consumer complaints

The Michigan Attorney General’s Consumer Protection Division accepts complaints about businesses, including contractors. It may contact the business to try to resolve the dispute.

You can also file with the Better Business Bureau. Many homeowners check the BBB before hiring, so contractors often respond to complaints there. Some disputes can also go to BBB mediation.

Pro Tip: Protect Yourself From Liens

Under Michigan’s Construction Lien Act, unpaid subcontractors and suppliers can sometimes place a lien on your home, even if you paid your contractor. On any big project, ask for a sworn statement that lists everyone who worked on the job or supplied materials. Then collect a lien waiver as each one is paid. If a contractor walks off mid-project, talk to an attorney about your lien exposure before you pay anyone else.

Step 4: Consider small claims court

For smaller amounts, Michigan’s small claims court is often the most practical route. In Oakland County, small claims cases are filed in the district court that covers where the contractor lives or does business, or where the work was done. Farmington and Farmington Hills are served by the 47th District Court.

Small claims has a dollar limit set by state law, so check the current limit with the court before you file. Lawyers can’t represent either side in Michigan’s small claims division, and both parties give up the right to appeal. Bring your photos, contract, payment records, and written communication, and present them clearly.

Planning to sell a home with an unfinished project? Let’s talk about the best way to handle it.

Call or Text 248-790-5594

Step 5: Talk to an attorney for larger losses

If your loss is above the small claims limit, or if liens are involved, it’s worth consulting an attorney who handles construction disputes. A demand letter from a lawyer alone sometimes resolves the matter.

Weigh the cost against what you hope to recover. Ask about fees up front, and whether your contract has an attorney fee or arbitration clause that could affect how the dispute is handled. Michigan Legal Help is a good starting point for understanding your options.

Step 6: Hire a new contractor carefully

Finishing someone else’s work often costs more than starting fresh. The new contractor has to check, and sometimes fix, what was already done. Get more than one bid, confirm each contractor’s license with LARA, and check references. Then put everything in a written contract, with payments tied to finished work.

Avoid paying large amounts up front. And make sure any required permits are pulled and inspections are scheduled, because that paperwork matters when you sell.

If you’re planning to sell your home

An unfinished project doesn’t have to stop a sale, but it needs to be handled up front. Open building permits can come up during the buyer’s review or the title process and delay closing. Check with your city’s building department and close out any open permits before you list.

Michigan’s Seller Disclosure Act requires sellers of most one-to-four-unit homes to disclose known conditions, and unfinished or unpermitted work is the kind of thing buyers will find. Being upfront, and pricing or finishing the work accordingly, avoids surprises at the inspection. Here’s how I help sellers prepare.

Illustrative Example

A Farmington Hills homeowner’s bathroom remodel stalls after demolition and rough plumbing. They document the work, send a written demand, confirm the contractor’s license with LARA, and file a complaint. Before hiring a new plumber, they collect lien waivers for the fixtures already delivered. When they later list the home, the permit is closed and the finished bathroom is noted on the disclosure, so there are no surprises at inspection.

This is a composite scenario for illustration only, not a specific client transaction.

Tom’s Honest Take

The best protection happens before the job starts: a licensed contractor, a written contract, payments tied to completed work, and lien waivers along the way. That’s not much comfort if you’re already dealing with a half-finished project, but it’s worth remembering for the next one.

If you’re thinking about selling, don’t let an unfinished project quietly become a problem at closing. Close out the permits, disclose what you know, and decide early whether to finish the work or price the home to reflect it.

Tom Gilliam, a REALTOR® with RE/MAX Classic in Farmington Hills, Michigan, advises homeowners whose contractor doesn’t finish the job to document the work, send a written demand, verify the contractor’s license through the Michigan Department of Licensing and Regulatory Affairs, and file complaints with LARA, the Michigan Attorney General, or the BBB. He recommends sworn statements and lien waivers under Michigan’s Construction Lien Act, small claims court or an attorney depending on the amount, and closing permits and disclosing unfinished work before selling.

What should I do first if my contractor abandons the job?

Document the work with dated photos, gather your contract and payment records, and send the contractor a written message with a reasonable deadline to respond or return.

Where do I file a complaint against a contractor in Michigan?

For licensed contractors, file with the Michigan Department of Licensing and Regulatory Affairs (LARA). You can also file with the Michigan Attorney General’s Consumer Protection Division and the Better Business Bureau.

Can a subcontractor put a lien on my home if I paid my contractor?

Under Michigan’s Construction Lien Act, it can happen. Sworn statements and lien waivers help protect you, and an attorney can explain your options if a lien is filed.

Can I use a lawyer in Michigan small claims court?

No. Attorneys can’t represent either side in Michigan’s small claims division, and both parties give up the right to appeal. Check the court’s current dollar limit before filing.

Do I have to disclose unfinished work when selling my home?

Michigan sellers must disclose known conditions on the Seller Disclosure Statement. Unfinished or unpermitted work is usually found during inspection, so disclosing it up front avoids problems later.

Can open permits delay a home sale?

Yes. Open permits can come up during the buyer’s due diligence or the title process. Check with your city’s building department and close them out before you list.

Recommended Reading

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About the Author

Tom Gilliam is a REALTOR® and Luxury Estate Marketing Specialist with RE/MAX Classic in Farmington Hills, Michigan. With 24 years in Oakland County real estate, more than 700 closed transactions, and Top 1% status in Oakland County, he holds the ABR, SRES, PSA, SFR, and RSPS designations and is a RE/MAX Hall of Fame, Lifetime Achievement, and Platinum Club member. This article is general information, not legal advice. Call or text 248-790-5594.