How to Avoid Home Improvement Scams | Reader's Digest

How to Avoid Home Improvement Scams

Here are some helpful ways to spot home improvement scammers.

By Reader's Digest Editors

Each spring and summer, professional home improvement scammers roam the U.S. in search of victims. They often target people who live in areas recently damaged by weather events—such as the tornado-ravaged Midwest—and older adults, offering “deals” on home repairs. Scams include using low-quality roofing materials and painting houses with cheap paint.

USA Today recently estimated that the number of these scammers—often referred to as “travelers” or “storm chasers”—varies from 20,000 to 100,000. So how can you avoid being fooled by one? Follow these tips.

Be cautious
Don’t do business with someone who comes to your door. Take the company’s information and tell them you’ll contact them if you need work done. Be especially wary if the contractor drives a vehicle with no company name and phone number or with out-of-state license plates. Do not let the person inside your home!

Do your research
Before working with a contractor, research the company. Check out its rating and complaint history with the Better Business Bureau.

Ask around
Ask neighbors, friends, relatives, or local consumer advocates for recommendations of reliable contractors.

Explore your options
Get at least three written bids for the work you want done from three different contractors before choosing one.

Check the contractor’s background
When you’re ready to hire a contractor, ask for proof that the company is properly licensed and bonded (to protect you against theft and damage), that it carries liability insurance, and that it provides workers’ compensation insurance.

Get references
Ask the contractor for references from the company’s last three jobs—and check those references!

Study the contractor’s business card
The card should have a certifiable street address and an office telephone number. Do not trust those that only have P.O. boxes and answering machines.

Get a contract
Demand a written contract that lists the specific work to be done, costs, materials to be used, start and completion dates, and warranty information on products and installation. Read the fine print carefully before signing it.

Be smart about payments
Do not pay more than 25 to 33 percent of the total job cost as a deposit. Hold off on your final payment until the job is finished and you are satisfied with the completed work. Also don’t make a final payment until you receive a lien waiver stating that the contractor has paid subcontractors and for supplies. Pay by check or credit card, not in cash.

Plus: 5 Biggest Home Repair Rip-Offs

Sources: denverpost.com, Better Business Bureau, msn.com

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