Checking on builder

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If the contractor has references that indicate successful completion of work, that is certainly in his favor. By taking out the permits as owner builder you are saving him considerable administrative overhead time and costs that may be reflected in the estimate. However, you should still insist on a written contract with a clear understanding of the scope of work, payment schedule and warranty. Also, you should specify (particularly in CA) that any employees or workers are covered by appropriate liability insurance policies and workmans compensation protection. If the owner/builder status is used to evade these provisions, you (throught the homeowners policy) could incur significant liabiltiy in the event of accident or injury. Put it in the written contract.

Finally, you should log onot the California Contractors State Licensing Board website for contracting guideance and legal information. You can also check on the license status of the contractor (by business name, personal name or license number) and his insurance at these links:

http://www.cslb.ca.gov/consumers/default.asp
http://www2.cslb.ca.gov/CSLB_LIBRARY/Name+Request.asp

Good luck with the project. If you check everything out per above, you should be safe with the lower bid. If you find that the contractor is not licensed or is suspended, or does not have insurance, take a pass.