SCAMS BULLETIN Host Jay White is a volunteer attorney who provides free legal services for low income seniors in San Mateo, California.

June 16, 2020

HOME IMPROVEMENT SCAMS

Crooks posing as contractors show up on a homeowner’s doorstep uninvited. They may say they happened to be doing work in the neighborhood and noticed that your house needs some repairs too. They will offer to fix your roof, repave your driveway or perform other repairs or renovations, for what sounds like a low price.

When that happens, be wary. The smiling fix-it man or woman at your door might turn out to be an unscrupulous contractor or an outright con artist, out to fleece you with a home improvement scam.

Shady contractors will often ask for payment up front. If given money, some take it and disappear. Others will do shoddy work or claim to have discovered some hidden problem in your house that needs immediate attention. They demand more money to complete the job (a dishonest variation of the sales tactic known as upselling).

Con artists look to prey on homeowners when they are vulnerable. If your house has been damaged by a storm or natural disaster, a scammer may show up and try to persuade you to sign over the payment from your insurance company. Some crooks seek out older homeowners with memory or cognitive problems, hoping to con them into paying multiple times for the same work.

What you can do to guard against being victimized by a home repair scammer:

Beware of persons who say they stopped by because they just happen to be in your neighborhood. The good ones are usually too busy to roam around in search of work.

Be skeptical if a person says he can offer a lower price because he will be using surplus material from another job.

Do

*Contact your state contractors’ license bureau to learn if the person has a contractor’s license.

*Do insist on seeing references. The Federal Trade Commission (FTC) recommends asking the contractor for names and addresses of past customers.

*The FTC also suggests asking the contractor for permission to visit a job currently in progress.

*Do require a bid in writing, and compare bids from multiple contractors before agreeing
to any work.

*Do check the Better Business Bureau (BBB) website to see contractors’ ratings and
whether any complaints have been filed against them.

*Do get a written contract before you pay any money and before the work starts.

*Do read the fine print. The BBB says a contract should include a detailed description of the work, material costs, start and completion dates, and warranty information.

*Before you make the final payment, verify that all work has been completed to your satisfaction, any subcontractors or suppliers have been paid and the job site has been cleaned up.

Do nots

*Do not put down a big deposit. By law in some states the maximum a homeowner must pay in advance is 10% of the total price before the job is completed.

*Do not pay cash. The FTC recommends using a check or credit card, or arranging
financing.

*Do not automatically take the lowest bid. Some contractors cut corners to come in lower than competitors. The FTC recommends that if one contractor’s estimate is significantly less than those of competitors, ask for an explanation.

*Do not let the contractor arrange financing for you. The FTC warns that you might be tricked into signing up for a home-equity loan with hefty fees or a high interest rate, or one in which the lender pays the contractor directly, giving him or her little incentive to finish the job or do it properly.

ATTRIBUTION: AARP