Homeowners should research contractors thoroughly. Check online reviews and ask for references. Don't just go with the cheapest option. For example, if a contractor has a lot of negative reviews about shoddy work or disappearing, avoid them.
Pay in installments based on milestones. Don't pay the full amount upfront. For example, pay a small deposit to start, then pay more when certain parts of the job are completed like when the foundation is poured for a home addition. This gives the contractor an incentive to keep working and also protects the homeowner if the work isn't satisfactory.
Get everything in writing. The contract should detail the scope of work, the materials to be used, the timeline, and the cost. This way, if the contractor tries to change things later, there is a written agreement to refer back to. Also, make sure the contractor is licensed and insured. You can check with your local building department.