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Ten Contractor-Scam
Warning Signs |
Here are a few things to watch
for when you first come in contact with contractors.
Warning Sign 1: Scare
tactics
"Well, your chimney looks
about ready to fall over. If that lands on someone's head
-- they're a goner. And you could have one dandy lawsuit."
If a contractor tries to literally "scare up" your
business, avoid him. Even if the repair is of an urgent nature,
an honest operator will not use gloom and doom to get your
business. At most, he or she might simply point out the possible
outcome of a neglected repair. For example: "Your roof
could develop some leaks within the next year" is a realistic
professional judgment. However, "Your roof is about to
cave in any minute" is a flagrant scare tactic.
Warning Sign 2: The hasty
quote on a big job
"I figure $5,800 should do
it," says the contractor
as he glances at the complicated repair, then quickly scribbles
a number on a scrap of paper.
When making a bid for your business, legitimate contractors
do not scribble on scraps of paper or offer verbal quotes.
They provide detailed written quotes. The exception to this
might be a quote given in answer to a casual inquiry or for
a very small, basic repair for which there is a standard rate.
Otherwise, a repair contractor should thoroughly examine the
problem and provide a written breakdown of the cost for labor
and parts.
Warning Sign 3: No identification
"Sorry. I forgot my business
cards. You can always look us up at our post office box address."
Legitimate contractors present themselves in a professional
manner. They have business cards and an established street
address -- not a post office box -- where they conduct their
business. In an industry of many small independents, that
street address might also be their home. That's OK. Self-employed
people often work from a home office. What's important is
that you know where to locate them if anything goes wrong.
Be cautious of anyone who cannot produce identification. They
could be transient operators -- people who work over an area,
then disappear.
Warning Sign 4: Refusal
to provide referrals
"We don't give out customer names. We respect their privacy.
You understand, don't you? I'm sure you wouldn't want me to
give out your name to strangers."
Avoid contractors who refuse to provide referrals. Legitimate
contractors are happy to name satisfied customers. Typically,
it is with the cust omer's permission that his or her name
can be used to recommend work to others.
Warning Sign 5: Pressure
tactics
"You'll have to sign up now. The manufacturer says
the prices are going up right away."
Pressure tactics for an immediate decision are intended to
prevent you from shopping around or finding out that the deal
is bad before it's too late. Be very cautious about a price
that is "so good that it can only be offered today."
Legitimate contractors offer quotes that are valid for a specific
time period -- usually 30 days. They will not insist on an
immediate decision. They understand that a large expense requires
some decision-making on your part.
Warning Sign 6: In the
neighborhood
"I've just resurfaced your neighbor's driveway and
I've got materials left over to do yours. Looks like it needs
work soon. I'll give you a really good deal."
This and other "we're in the neighborhood" lines
are a warning. First, a legitimate contractor does not overbuy
materials for a job and expect to unload them on the job site's
neighbor. Second, a legitimate contractor will not take on
a job from the perspective of getting rid of excess materials.
He or she will assess each job based upon its individual needs.
It may be legitimate for the contractor to contact you "since
we're in the neighborhood." If that is the case, then
you'll want to speak to your neighbors to find out the quality
of the work. You'll likely not want to plunge in at that very
moment, in any event.
Warning Sign 7: Up-front
payment
"That's gonna involve a lot
of materials. I'll have to ask you to pay me now."
Requests for up-front payment before work begins should trigger
a warning bell. Many people pay up front for work and then
never see the contractor again. You should pay in advance
of work only when it is a large job, you have already properly
screened the contractor (checked references, etc.), and you
have a proper contract. Upon signing the contract you might
pay a percentage of the total amount -- usually around 30%.
Warning Sign 8: Refusal to provide a written guarantee
"If anything goes wrong, just call me. You have my word."
No matter how sincere the assurance might sound, never accept
a verbal guarantee. If anything really goes wrong, you'll
quickly find out how worthless words can be. Legitimate contractors
provide written guarantees that specify what is covered and
for how long.
Warning Sign 9: Under
the table deals
"I can give you a good deal for cash."
Under the table cash deals usually mean that the contractor
is not paying taxes, and therefore can cut his or her price.
The catch is that you will have no paper record of the work
-- no receipt and no written guarantee. If a problem occurs,
you'll have no recourse. Legitimate contractors do not indulge
in this kind of practice.
Warning Sign 10: Referral selling
"There's a big rebate for you if you refer customers
to us." Or: "You'll
get a special discounted price if we can use your home as
a model to show off our work. We'll just put a sign on the
front yard."
If a contractor or "company representative" offers
to give you a discount or rebate to refer customers or become
a "model" home, be cautious. At best, this is a
marketing gimmick. At its worst, it's an outright scam. If
you shop around and compare prices for the same work, you
can find that the discounted price is the same as -- or even
higher than -- regularly priced work.
Finally, here's an eleventh tip, for free: Use your common
sense to detect warning signs. Trust your instincts! |
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