4 Common Contractor Scams to Look Out For

Posted by Hannah Lapin on Sep 27, 2018 9:00:00 AM

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When hiring a contractor for some work on your home or rental property, it is extremely important to have a written contract, ensure your contractor has proper licensing and insurance, and cross check references. While these three best practices can help reduce your risk, you should still be on the lookout for these four common contractor scams, highlighted by MyHouseDeals.com.

  1. Beware of contractors asking for money upfront.

    Scheming contractors will ask for 30%-50% of the price upfront, while legitimate contractors will ask for up to 10% of the whole project price.
  2. Beware of contractors asking you to take their word for it.

    Scheming contractors suggest large upgrades without bothering to revisit the contract and then demand more money for no work. Even the slightest change should be agreed upon in the contract.
  3. Beware of contractors telling you they don’t need a permit.

    Scheming contractors try to justify that a permit isn’t necessary or try to talk you into a homeowner’s permit rather than a building permit (YOU are responsible for all the work done in a homeowner’s permits, so never agree to that!) MyHouseDeals advises that if your contractor is being even the slightest bit iffy about permits, put the job on hold until it is sorted out.
  4. Beware of contractors who find unforeseen issues when a project is almost over.

    Scheming contractors will make up structural problems, bug infestations, or anything to upcharge you. Some of these are legitimate, but it is always a good idea to get a home inspection and confirm.

To learn more about contractor scams, read the full MyHouseDeals Blog or check out the Federal Trade Commission's (FTC) Guide.

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Related: Avoid a Contractor Scam Post Florence. 10 Essentials for a Landlord Toolbox

Topics: Landlording

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