Last updated: October 11, 2026. This guide is general information, not legal advice. Rules for contractors differ by state.
Hiring a waterproofing contractor is usually a decision made under stress: there is water on the floor, a storm is in the forecast, and a salesperson is offering a fix that costs several thousand dollars. That combination is where homeowners overpay, sign contracts they do not understand, or hand over a large deposit to a company that never finishes the job. This guide walks through what to verify before you sign, what a good contract contains, how much of a deposit is reasonable in the states whose rules we checked, and which warning signs to take seriously.
Start with the cause, not the contractor
Before you compare companies, find out what is actually wrong. Water can come from surface runoff, a high water table, a failed window well, a leaking pipe or plain condensation, and each cause calls for a different fix. A contractor who quotes a complete drainage system after a quick look, without asking where and when the water appears, is selling a product rather than diagnosing a problem. Our guides on warning signs of a basement water problem and water seeping through walls after rain will help you describe the problem accurately and ask better questions. Also rule out the inexpensive fixes first, such as extending downspouts and correcting the grade near the foundation (see foundation grading).
Verify the license or registration
There is no single national license for waterproofing contractors, and the rules differ widely. The official guidance we reviewed shows how much:
- Massachusetts tells homeowners to hire only contractors registered with its Home Improvement Contractor program, to ask to see the registration card and to check the contractor’s status and complaint history online (Massachusetts).
- Virginia says to work with licensed contractors and to confirm that the license is active, and to check for past disciplinary actions, using the state license lookup (Virginia DPOR).
- New York requires home-improvement contractors to be licensed or registered in New York City and in several counties and cities, so the check depends on where you live (New York Attorney General).
Your state licensing board or attorney general’s office is the place to start. Ask for the license number in writing and look it up yourself rather than trusting a number printed on a business card.
Ask for proof of insurance
Ask for proof of liability insurance, which covers damage to your property during the work, and workers’ compensation insurance, which matters if someone is injured on your property. Massachusetts guidance specifically recommends asking for both (Massachusetts). Ask for the certificate to be sent to you directly by the insurance agent so you can confirm it is current. A verbal assurance is not proof.
Get three written quotes and compare the scope
Get at least three written estimates and ask why they differ rather than automatically choosing the lowest one. Virginia’s guide makes the same recommendation (Virginia DPOR). Two quotes with very different prices often describe very different jobs. Put them side by side and check:
| What to compare | Why it matters |
|---|---|
| Interior or exterior work, and linear feet of drain or wall covered | A partial perimeter costs less but may leave the problem unsolved |
| Sump pump make and model, and whether a battery backup is included | A pump that stops during a power outage cannot protect you during a storm |
| Where the water is discharged | Water pumped next to the house can come back |
| Who does the work: employees or subcontractors | Affects quality control and who is responsible if something goes wrong |
| Permits, cleanup and floor or wall restoration | Some quotes leave these out and add them later |
| Warranty length, what it covers and whether it transfers | See our warranty guide |
Before you judge a price, compare it with the ranges in our basement waterproofing cost guide, which explains why published estimates disagree so much.
What the written contract should include
Never rely on a verbal promise. Requirements vary by state: New York requires a written contract for home-improvement work over $500 (New York Attorney General), Massachusetts for jobs over $1,000 (Massachusetts), and Virginia requires licensed contractors to provide a signed written contract for residential work (Virginia DPOR). Whatever your state requires, insist on a written contract that includes:
- The contractor’s legal name, address, phone number and license or registration number.
- A detailed description of the work and the materials, including brands and models.
- The total price and a payment schedule.
- Approximate start and completion dates.
- The warranty terms, written out in full.
- A notice of your right to cancel, where state law requires one.
- No blank spaces. The New York guidance lists documents with blanks or incomplete sections as a warning sign.
How big a deposit is reasonable?
There is no national rule. The three states we checked handle deposits differently, which is exactly why you should check your own state before agreeing to a number.
| State | What the official guidance says |
|---|---|
| Massachusetts | Do not pay more than one-third of the estimated cost up front unless special-order materials are needed. Never pay in cash. |
| Virginia | Limit the initial deposit to 10% of the contract or $1,000, whichever is less, and up to 30% for custom or special-order items. Tie later payments to completed work and do not pay in full until the job is finished. |
| New York | The page gives no percentage cap. Contracts for prepaid funds must place them in an escrow account, and the contractor must tell you within five days where the money is held, or show bond insurance. |
Whatever your state, a payment schedule tied to completed stages is safer than a large payment before work starts, and the final payment should come after you have inspected the finished work.
Protect yourself from liens
A mechanic’s lien is a claim that contractors, subcontractors and material suppliers can place on a property if they are not paid. In some states, a subcontractor who was never paid can file a lien even if you paid the general contractor in full. The Minnesota Attorney General handbook explains how this works in Minnesota and recommends that homeowners list all expected subcontractors and suppliers in the contract and collect signed lien waivers from each before making the final payment. A lien waiver is a signed statement in which the subcontractor gives up the right to file a lien. Deadlines and notice rules vary by state, and if a lien is filed, the handbook advises speaking with an attorney.
Red flags that should stop you
The same warning signs appear across the New York, Massachusetts and Virginia guidance:
- Unsolicited door-to-door offers, especially after a storm, or someone claiming to be “in the area” or to have leftover materials from another job.
- Pressure to sign today, or a price that is “only good right now.”
- A demand for full payment up front, for cash, or for payment by peer-to-peer apps such as Venmo.
- Refusal to provide a license or registration number, proof of insurance or references.
- A contract with blanks, or no written contract at all.
- A request that you pull the permits yourself. Massachusetts advises making the contractor do it.
- Out-of-area “storm chasers” who may be hard to find later if something goes wrong.
Your right to cancel
If a salesperson visits your home and you sign there, you may have the right to cancel. The FTC Cooling-Off Rule requires sellers to tell you about a three-business-day cancellation right for certain sales made at your home or other non-business locations, above a minimum amount and subject to exceptions. New York and Virginia also describe a three-day cancellation right in their guidance. In an emergency, New York lets you waive the right in writing, so read any waiver carefully before you sign it. Check the rule text (16 CFR Part 429) and your state attorney general’s office for the rules that apply to you.
Questions to ask every contractor
- What is causing my water problem, and can you show me the evidence?
- What would happen if I fixed only part of the problem instead of installing the full system?
- Who will do the work: your employees or subcontractors?
- Can I speak with a customer whose job you completed at least five years ago?
- Who is responsible for permits, and are they included in the price?
- If I need a warranty repair and your company is gone, who honors the warranty?
- Will you provide lien waivers from subcontractors and suppliers before my final payment?
National chain or local company?
Large national franchises and local independent contractors each have trade-offs, and we could not find reliable independent data on how their prices compare. A franchise may offer standardized systems and written warranties backed by a larger company. A local contractor may offer more flexible solutions and be easier to reach. The practical approach is to get at least one quote from each, ask both the same questions, and compare the written scope and the contract line by line. Judge each company on its license, insurance, references and contract, not on its size.
When to schedule the estimates
If your basement is not actively flooding, avoid signing in the middle of a crisis. Evaluations scheduled when the weather is dry give you time to compare quotes, and you may be able to watch how the basement behaves during the next rain before you commit. If water is entering right now, deal with safety first and make temporary arrangements, then take the time to compare contractors.
Related guides
How we put this guide together
We read the consumer guidance published by the New York Attorney General, the Commonwealth of Massachusetts, the Virginia Department of Professional and Occupational Regulation and the Minnesota Attorney General, plus the FTC’s Cooling-Off Rule page, on October 11, 2026. We report what each source says and name the state next to each rule. We did not generalize one state’s rule to the whole country, and where a figure or rule is state-specific we say so. If you live elsewhere, your state attorney general or contractor licensing board is the authoritative source.
Sources
- New York State Attorney General, “Contractors and Home Maintenance”
- Commonwealth of Massachusetts, “Avoiding Home Improvement and Contractor Scams”
- Virginia Department of Professional and Occupational Regulation, “Consumer Guide: Hiring a Contractor”
- Minnesota Attorney General, Home Building handbook, “Understanding Mechanic’s Liens”
- U.S. Federal Trade Commission, Cooling-Off Period for Sales Made at Home or Other Locations
Want to see the published ranges added up for your own measurements? Try our basement waterproofing cost calculator.
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