The key in any remodeling situation with a contractor is to take steps to protect you and to not rush into the contracting job. If you vet the contractor and don't hand over cash before the contracting deal starts, you will stand a better chance of not being scammed and getting a good remodeling job done for the right amount of money.
Below are some resources to help you prevent personal home improvement fraud. You can also find more information on organizations and groups that help those dealing with home repair scams and who to contact if you feel approached by a fake contractor.
Seniors are the most at-risk when it comes to fraudulent contractors and home improvement scams. Why are they preyed upon more than other types of homeowners? First, seniors own more than half of all the financial assets in the United States, making them prime targets. 30 percent of all scam cases in the United States list seniors as victims. Research shows that seniors are more susceptible to scams than other age groups, either because they're more open or polite.3
In terms of fraudulent contractors, the US Department of Health estimates that 60 percent of the elderly live in homes 20 years or older. These homes usually need updates and renovations like walkways and other improvements for better accessibility.4 As such, when a fraudulent contractors comes to offer a deal, seniors do not ask as many questions or complete background checks because they need the work done. When they realize they have been duped, they will often not report it for fear of shame or being put in a home. If they do decide to report the home improvement scam, they will usually remember fewer details about the crime.5
The most common types of home improvement fraud include: 1) intentionally providing false information; 2) receiving payment but not providing the remodeling services; 3) changing the terms of the contract and increasing the costs, and 4) publishing false advertising.6 Most often, these scamming home improvements will start with someone appearing at your door, offering to do work on your home like spray the roof, coat the driveway or fertilize the lawn with tools they had leftover from another job in your neighborhood.7
Some other warning signs for home improvement scammers include:
If one or more of these warning signs come up in your initial conversation, then you need to politely respond "no" to their offer and consider warning your neighbors about these suspicious contractors going around offering these services.
Once you choose a contractor for your remodeling job, there are questions you should ask him or her concerning their business and building practices. While this list is not meant to be all-inclusive, it should give you an idea of the sorts of questions to ask when it comes to learning more about the contractor and the work they will be doing for you.
A visit to a site in progress can reveal much about a company's ability to manage a large project. Notice how organized it looks. Is it messy and chaotic or does it seem well-organized with workers moving like they know what they are doing.9
Should you choose to go forward with the contractor, consider these steps to protect yourself from home improvement fraud:
Most importantly, if the remodeling job doesn't feel right to you, then you should not proceed. You have a three-day window after discussing the project with the contractor to rescind, and it is completely within your consumer rights to do so. So do not hesitate or be intimidated by the contractor if you feel uncertain about the project and want to rethink having it done.
For more information on preventing home improvement fraud, see these sources:
If you feel like you encounter a fraudulent contractor or are a victim of home improvement fraud, there are a variety of organizations and federal groups you can get in touch with for help. The National Center for the Prevention of Home Improvement Fraud (NCPHIF) is one group that helps homeowners get the right help and avoid fraud by providing them with a step-by-guide on remodeling projects and how to protect against fraudulent home improvement claims.
The Better Business Bureau (BBB) is another resource that homeowners should utilize when hiring a contractor to do remodeling work. They have a database of contractors who are licensed in the United States, with information on ratings and complaints. It's a good way to check on your contractor and see if they're the right one for the job you need done on your home, or if they've done poor work in the past or less work for a higher price.
You can also contact your local FBI branch if you feel victimized by a home improvement fraud. You can find a complete list of branches in the US and get in touch with the one closest to you. The National Consumers League (NCL) also has a fraud website where you can stay informed on current fraud scams in the United States and submit a scam tip to them.
Call for Action is a non-profit organization that also investigates fraudulent contractors, with local offices across the United States. It takes tips from consumers, puts out publication, and organizes various projects as part of its campaign towards action against issues in the United States including home improvement fraud. Please contact them if you are concerned about a fraudulent contractor and have a chapter in your area.
If you'd also like to get a remodeling contractor without having to go through the BBB and doing various background checks on your own, you can select a contractor in the HomeAdvisor ProFinder database. All of our contractors are already screened and approved, so you won't have to worry about fraudulent home improvement claims or losing money for a remodeling job you need completed.
Our seal of approval is awarded to contractors who pass our thorough background screening check, which can include state-level licensing if applicable. We check their business for criminal and sexual offender employees, insurance coverage, verification of business filings, and more.
For more information on our seal of approval and why you can trust the contractors we verify, read more on the HomeAdvisor Seal of Approval.