Remodeling Contractor Scams – Buyer Beware

Remodeling Contractor Scams – Buyer Beware
By Steve Frick

It never fails; when the economy slows, the scammers seem to come out of the woodwork just waiting for their next “easy mark”. Here are some tips that will help you avoid being the next victim and assure that your remodeling project goes smoothly.

1: Only work with contractors who are licensed, bonded and insured. While many contractors may have a license, it is surprising at how many are operating with no worker’s compensation and liability insurance! This issue cannot be overstated. More on insurance below…

2: Do not work with anyone who asks for large “up front” deposits at the contract signing. California law (where we are based) regulates how much a contractor can receive before work begins. For California, the maximum at contract signing is $1,000 or 10% of the contract price whichever is less. Your state may be different so check with your license board.

3: Make sure the company you are considering has been in business for years (not months). Due to the low barriers to entry in the construction industry (i.e. a truck, some tools, pass the exam and “voila” they are a general contractor) people come and go quickly; especially when the economic winds change. You want to know that whoever you entrust your project to; they will not only complete the job, but be there for you down the road should there be any issues or concerns..

4: Check with the Better Business Bureau. This a great resource for checking on contractor credibility. There is an annual fee to belong to the BBB (albeit a nominal one); but if a contractor does not belong the BBB, you will want to tread carefully.

5: Check with the Contractor’s State License Board to make sure their license is active and see if they are currently bonded and insured.

6: Worker’s Comp Insurance: This insurance is mandatory in the state of California however, this does not deter many “fly by night” operations from conducting business without it. This insurance protects the workers in the event of an injury. More important to you: This insurance protects you in the event a worker is injured: If the contractor does not have insurance, the injured person will undoubtedly go after the homeowner for injuries sustained (always consult an attorney for legal advice).

7: Liability Insurance: This protects your home in the event of theft or damage to your property during the project. No liability insurance, no protection for you the homeowner. For example, you are doing a bathroom remodel and the plumber is soldering the new water lines: He gets careless and starts a fire. Without contractor liability insurance, who gets stuck with the bill? You guessed it!

In closing, there are many fine, honest and ethical contractors out there… just want to make sure you find one of them. It is important to note that “You Get What You Pay For”. There is a price for the safety and security of working with a larger, more reputable company (no low-ball estimates)… in apples for apples bids, the un-insured contractors working out of the back of their truck will give you great pricing up front. The real question for you is “is it worth the risk”?

If this article has been helpful and you would like more information on our remodeling services, please visit our website at http://www.pdremodelingsandiego.com

For a free estimate, simply call us at (858) 560-0444 or send us an e-mail at sfrick@pdr-sd.com. We will be happy to give you a free consultation. We service all of San Diego County

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Five Star Services

Calfinder.com get bids from qualifying contractors.

Find a contractor for your next Additions or Remodeling projects. Contractors.com a great website and service of course free

Service Magic The industry leader in home service contractors

Find thousands of unbiased ratings on services for home improvements, car repairs, and more. Try Angie’s List. Not free but deserves mentioning for their unbiased reviews of contractors.

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