Spring is the season for home repair and home improvement. Some older homeowners may have a hard time physically and/or financially maintaining their homes. It is because of this that they are targeted by scammers. Most contractors are honest and hardworking but how can you tell? Here are five ways to identify if a contractor is trying to defraud you.
1. “You’ll Need to Pay First”
According to the Better Business Bureau, this is the most common scam reported. The contractor will tell you that materials and equipment need to be ordered. Once you hand over the money, a couple things can happen. One, they disappear. Two, they complete the work carelessly and haphazardly.
2. “Trust Me”
You have hired your contractor, you have sat down and discussed what work you want done and your expectations and the contractor agrees. Now it is time to sign the agreement. You notice some of the details and upgrades are not included. The contractor tells you to “trust me”; it will be taken care of. The next thing you know, the work is not done. Now the contractor tells you that he did not include those extras in the quote he gave you and you will have to pay more money.
3. “We Don’t Need a Permit”
Any significant construction project is required to have building permit. This allows officials to visit occasionally to ensure the work meets safety codes. Dishonest contractors will tell you that a permit is not required. Others will try to have you take out a homeowner’s permit. That would mean lying to authorities about who was doing the work and make you responsible for monitoring the inspections.
4. Unexpected Problems
The construction has started or even finished and suddenly the contractor tells you there were unforeseen issues like termites and now the price has skyrocketed. Sometimes additional fees are legit, but other times dishonest contractors will bid very low to get their foot in the door and then increase the cost later.
5. Extra Materials
This fraud usually comes from paving companies or roofers or painters. They tell you that they have extra materials and they can perform the work dirt-cheap. A couple things can happen. One, they actually do not do the work and take off with your money. Two, they start the work and the job is more involved than they thought and it will cost even more. Third, the work is completed carelessly and in one year your roof is leaking or driveway cracking.
The Legal Aid Society of Middle TN has a detailed booklet about what you need to know before repairing or remodeling your house. Legal Aid Home Repair Booklet. Here are just a few suggestions on how to keep from being a victim of contractor fraud
- Hire contractors currently licensed from the TN Board of Licensing contractors. Call 1-800-544-7693 to verify the license. You can also ask the Board if they have had any complaints.
- Ask the Board if the contractor has paid the insurance bond. This will protect you if the company goes out of business or does shoddy work.
- Use word of mouth. Ask friends, neighbors, etc. for suggestions who did great work.
- Ask for references and verify those references.
- Avoid using a contractor that only has a PO Box or answering service.
- Call the BBB at 615-242-4222 or TN Consumer Affairs Division at 615-741-4737 to see if any complaints have been filed
- Always get more than one bid from different contractors
- Never hire “on-the-spot”
- Never accept a verbal agreement. Always get a written agreement/contract.
- The contract should not have blank spaces.
- The contract should include the license number, address and phone numbers, what work is to be done, what kind of materials, estimated completion date, cost, how you will pay, and if there is interest to be paid.
- Read the contract
- Never pay cash
Sources: Legal Aid Society of Middle TN and www.houselogic.com