Almost every year you’ll see a news article about a shady contractor that scammed people out of thousands of dollars. The vast majority of contractors are honest, hardworking people who take great pride in their work but it only takes a few bad apples to spoil it for everyone. Back in 2010, one homeowner in Waterbury LaSalle was fleeced out of $5000 by an unlicensed contractor who didn’t complete the job. In 2014 another contractor scammed the Department of Education for more than $1 million in overpriced work.
Most of the tactics these scammers use are tried and tested methods. Here are the five most common and how you can avoid them.
1. Bait and Switch
This is perhaps the easiest and most common of them all. Usually, it starts with a newspaper ad or flyer that advertises a service you need at a ridiculously low price. The customer gets it and believes they’ve got a great price but then the switch comes in. The contractor informs you that your roof, air ducts or whatever it is are in far worse condition than the average. He then quotes you a price that’s hundreds or even thousands of dollars over the advertised price.
Protect yourself by having a contract written which states the scope of the work. if something is too good to be true it probably is.
2. Upfront payment
The next most common ruse is when a contractor asks for an upfront payment, either partial or full before work has even begun. One of two things then happen, he either disappears with your deposit or does a half-effort job because he knows you can’t fire him since he’s sitting on a large chunk of your money.
A small upfront payment is perfectly normal but this should never exceed 10%. All other payments can be done according to milestones that you’ve agreed upon in a written contract.
3. Extra Materials
This type of scam usually starts with the phrase “I was in the neighborhood and noticed your roof shingles are in need of repairs” – or some variant. They offer to do the job with ‘extra materials’ from another job which are often either fake or inadequate.
Never hire contractors on the spot or without any references, no matter how good the deal seems. If problems do arise after they’ve left you can be pretty sure you won’t find them again.
4. Taking someone at their word
On first meeting the contractor he’s very agreeable and polite with understanding what you need. He even suggests some changes of his own that will improve the final design. But then these suggestions don’t make it into the final contract and you brush it off because you had such a cordial understanding. Later you notice that these suggestions have not been built. On confronting the contractor, he informs you that these extras were not included in the final price so you’ll need to pay more to redo them.
Unfortunately, there is little you can do about this from a legal standpoint since you signed a contract that didn’t include these extras. Always ensure that everything is included in the contract and any changes are added before work starts.
5. Limited-Time Offers
Be wary of any contractor that tries to use high-pressure tactics to make you sign a contract or hand over a check immediately. This can be used in conjunction with the other scams to get you to sign before you can research prices and check references. Fortunately, under state and federal law there is a mandatory three-day ‘cooling-off’ period that allows contracts to be canceled even after they’ve been signed.
In New York, the cooling-off period does not begin until the customer has received a “Notice of Cancelation” form. Until this form is received the customer can cancel the sale by notifying the contractor in any manner at any time.