Life Times Newsletter

Spring 2010
Vol. 12, No. 2





Hiring a contractor: Beware of scams


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Kandace Fisher, MS
Housing & Environmental Design Specialist

Recently two men in a white truck pulled up to my house. I met them at the door and asked what they wanted. They were contractors who drove to my town to do a job and “happened to have materials left over they could sell me at a great price.” I told them I wasn’t interested, but asked for a business card.

A couple of things alarmed me about this situation. First, they made a conscious effort to approach my house and my neighbors’ houses. Second, their truck was plain white with no decals distinguishing it as a business truck. Third, they happened to have materials for “a great price,” but I didn’t request their service or materials. Finally, their business card was made on a home printer, had no business name and no permanent phone number. The only contact phone number was for a cell phone.

This is a good example of how a contractor scam can occur. To avoid falling victim to such a scam, keep these points in mind:

· 4Beware of door-to-door contractors. Be cautious if a contractor comes to your door selling services or materials you didn’t request. This often happens after a storm or natural disaster, when contractors drive through neighborhoods looking for obvious damage.

· 4Beware of low bids. Accepting the lowest bid for a job can be tempting. However, get at least three bids from different contractors to compare. The lowest bid may not include all labor and materials necessary to complete the job correctly.

4Beware of contractors who pressure you to sign a contract. Look a contract over carefully. Make sure the contract includes: bid amount for all materials, labor and equipment; description of all work to be done; date work will begin and end; payment  schedule; certificate of insurance; and if the contractor will be responsible to clean up, remove debris and protect landscaping. Find out if the contractor will obtain building permits. If you are unsure about the wording, have someone with legal knowledge review the contract before signing.

4Beware of contractors whose business van has no address or phone number.  Also be wary of contractors who give you a business card with only a cell phone number.

· 4Beware of contractors with no references. Don’t be afraid to ask for references. If contractors are reputable, they will provide references from past customers. Also ask friends and neighbors for references for specific jobs. 4

    4Beware of contractors with no insurance. Make sure any contractor you hire has both general liability insurance and workers’ compensation insurance. General liability insures the 
       contractor for damage to your property due to faulty workmanship and injuries to persons as a result of the contractor’s operations or negligence. Workers’ compensation provides the
       contractor’s employees with medical and disability insurance for on-the-job injuries.

· 4Beware of contractors asking for the entire payment upfront. Never give a contractor full payment for a job before starting. Some contractors ask for advance partial payment (usually one-third of the total bid) to purchase materials for the job. Do not pay the rest until the job is completed to your satisfaction. If the job is only repair and no materials need to be purchased, do not pay until the job is completed.

If you’re a scam victim, contact:

· The contractor’s trade association

· Missouri Attorney General’s Office, 1-800-392-8222

· Your local Better Business Bureau.






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University of Missouri Extension Editor: Roxanne T. Miller