How to Avoid Home Repair Scams

 By Catherine Powell

Image Courtesy Pixabay

Just as night follows day, so too do home repair scams.  No sooner does a severe storm blow through town when contractor reps start prowling local neighborhoods looking for signs of damage.  If they spot a tree down on your property or a few missing shingles on your roof, the next thing you'll hear is a knock at your door.  The smiling rep will tell you that his company can remove that tree or replace that roof. Some will tell you they get the job done cheaply while others say they can help you deal with your insurance company so the repair won't cost you a dime.  All you have to do is sign on the dotted line.  What could be easier?  Before you sign any contract, there are a few things you need to know about dealing with contractors.  Below are ten tips to help you avoid unscrupulous contractors the next time you need to make a home repair.

#1: Look before you leap. - Any time you deal with a contractor, you first need to check them out.  Are they licensed, bonded and insured?  Does the company have a good reputation, or does a web search turn up a litany of complaints?  Has the firm been in business for many years, or is it a Johnny-come-lately?  Even if the company has been around for decades and has a sterling reputation, before you sign on the dotted line, you need to find out if the rep actually works there. You also need to check out any potential contractors with the Better Business Bureau and ask for references.

Here's what AARP had to say about home improvement scams: "One alleged fraudster arrested in April 2020 in Bayonne, New Jersey, was charged with coercing $200,000 from a 65-year-old homeowner, escalating what started as a leak repair into a series of unnecessary jobs over the course of three months. The suspect had a history of arrests for similar scams in other cities, Bayonne police said."

#2: Never pay up front for a repair. - Some reps will try to pressure you into paying in advance.  Pay up front and chances are that's the last you'll hear from the rep.  Any reputable contractor should be able to cover the expense of performing a repair without having to put the bite on a customer.  If you're asked to put down a deposit, your best bet is to put it on a credit card, since that gives you the right to demand a refund if the work isn't completed or is done shoddily.  Using cash or a check to pay a deposit can leave you holding the bag if the contractor walks away from the job.

#3: Always solicit at least three bids from different contractors. - Make sure the bids include everything from the cost of material and manpower to permits and inspections.  Make sure you scrutinize all bids to ascertain a contractor hasn't left out something that will later come to haunt you when there comes a demand for an additional payment.  You'll also want to know the start and completion date of the repair as well as any warranties for work that will be completed. 

#4: Never let a rep talk you into letting the contractor arrange financing. - As bad as having a contractor hit you up for more money in the middle of a repair, what'seven  worse is finding out that you've been had when the contractor talks the lender into paying him directly.  This is as bad as paying the contractor in advance, since it provides little incentive to complete the job to your satisfaction.  It's better to talk to your banker or use a credit card to finance a home repair.  This way you're in the driver's seat when it comes to financing and have some leverage over the contractor.

#5: Warning signs of a slipshod operation.- Beware of door knockers.  A legitimate contractor has too much work to send reps door to door.  Likewise if a rep pressures you to sign a contract or asks for cash up front, show them the door.  Reputable contractors don't work that way.  If you ask a question the rep can't answer or that is answered incorrectly, call the contractor directly.  If not you could be dealing with someone who isn't even in the employ of the company he or she is representing.  Don't sign anything you haven't read completely or don't understand.  Don't sign a contract with blank spaces in it.  This is done by unscrupulous companies who will then be able to alter the deal they promised you at a later date.

#6: The perils of a contractor's lien. - Whether you realize it or not, when you hire a contractor to repair or enhance your home, you run the risk of having a contractor's lien placed on your property.  Fail to pay and you could wind up losing your home, since the court can force you to sell the property to satisfy the lien.  Therefore you need to be careful when you sign up with any contractor.  Not only could you be held liable to pay the contractor, you could also be responsible for paying any subcontractors and/or suppliers your contractor fails to pay.

#7: Never let a contractor deal with your insurer. - In Florida, it is illegal for a contractor to handle an insurance claim.  Only a homeowner, an attorney hired by a homeowner, or a public adjuster is legally able to negotiate with an insurance company in the Sunshine state.  If a roofer or other contractor tells you they can get your insurance company to pay for a repair to your home, they are breaking the law.

#8: Research the problem online before contracting out the repair. - You can find out just about anything online when it comes to home repairs.  By understanding the process and the costs involved, you'll be able to keep a contractor from gouging you by recommending unnecessary repairs.  This in turn will not only save you money, it will also help you weed out unscrupulous contractors.

#9: Make sure all the i's are dotted and the t's crossed before signing off on a job. - A big mistake made by some unwary homeowners is to sign off without first receiving a lien waver that states the contractor has paid the subcontractors and suppliers.  The last thing you want to do is assume you are good to go only to receive a demand for payment after you've let the contractor off the hook.

#10: Don't always opt for the lowest bidder. - If a deal looks too good to be true, it usually is.  Several reasons a contractor will low ball a bid is because they plan on using substandard materials or unskilled labor.  Others will omit items from the bid they know are necessary, only to hit you up for more money in the middle of the job.  

Catherine Powell is the owner of A Plus All Florida Insurance in Orange Park, Florida. To find out more about saving money on all your insurance needs, check out her website at http://aplusallfloridainsuranceinc.com