Adding a room, renovating a basement, or doing a much-needed home renovation can be a big project. The first step is to find a reliable contractor. Scammers promise to get the job done, but leave your home and pocket worse off than before they started. They may do shoddy work, damage your home, overcharge you, or just take your money without providing you with any services. How to distinguish between a reliable contractor and a scammer? Before you hire a contractor, learn to recognize the signs of a home improvement scam. Outside fraudsters may be the first to arrive at your home after a disaster. Protect your repair dollars by hiring local contractors, requesting written quotes, and checking references.
TIPS TO AVOID CONTRACTOR SCAM PROBLEMS
1. Get more than one offer If you receive at least three offers, you can decide which offers may be too high or too good to be true. Your insurer will give you an idea of how much the repair will cost. Offers must be made on company letterhead with phone number and address. Keep copies of all contracts and warranty terms.
2. Check everything you sign Read each document carefully before you sign. Scam contractors will try to get you to sign a contract, calling it an estimate or a release, to get on your roof. And don’t sign the contract in the spaces. Disreputable contractors will fill in the gaps at a higher cost or with a different job than you wanted.
3. Beware of Misleading Wording Don’t sign contracts that say: Landlord accepts listed repairs at insurance proceeds value. If he signs it, the contractor keeps every penny of his insurance premium. Make sure the contract lists the materials you will use. Beware of defective or poor quality materials while working.
4. Don’t pay in advance Be careful if the contractor requires a large or full deposit. After a disaster, it is illegal for outside contractors to ask for payment up front before starting.
5. Reject offers that exclude your deductible It is illegal for a contractor to offer to exclude your insurance deductible or add a deductible to a quote. If this happens, find a new contractor.
HOW TO AVOID HOME IMPROVEMENT CONTRACTOR SCAMS
Here are some tips to protect yourself and your pocketbook:
• Consider hiring only licensed and insured contractors. Contact your county or state government to verify the contractor’s license and ask the contractor for proof of insurance.
• Ask your local homebuilders association and consumer protection authorities if they have contractor complaints. You can also search the Internet by entering the company name and words like “fraud,” “review,” or “complaint”; if you are searching in Spanish, add words like “fraude”, “commentario” or “queja”. Use trustworthy review sites to see other people’s opinions of the contractor.
• Receive multiple offers. The written estimate must include a description of the task, materials, completion time, and price. Don’t automatically choose the cheapest offer. If there is a big price difference between the offers, ask for an explanation.
• Read the contract carefully. Contract requirements vary from state to state. Even if your state doesn’t require a written contract, ask for one. Before signing the contract, make sure it contains the following information:
• Contractor’s name, address, phone number and license number. o Estimated start and end date.
• Promises made during conversations or phone calls relating to, for example, work volume and the cost of labor and materials.
• Written notice of the right to rescind the contract within three business days, if you signed it at your home address or at a place other than the seller’s permanent establishment.
• Not paying the entire amount of the project in advance. In fact, some states limit the amount of money a contractor can request as a down payment. Contact your state or local consumer protection agency to find out what laws apply in your area. Never make a final payment until the job is done and you are satisfied with the job.
https://consumidor.ftc.gov/articles/how-to-avoid-a-home-improvement-scam#signs
https://www.tdi.texas.gov/tips/spanish/contractor-scams-sp.html