Shady Contractors: Warning Signs to Watch For

February 24, 2009

Even the most reputable of builders and contractors can experience issues with construction defect claims. As a group, however, these professionals tend to stand behind their work and generally have adequate insurance to cover unforeseen events. Therefore, one of the best ways to avoid construction defects in the first place – or at least avoid problems resolving a construction defect claim – is to deal with a reputable contractor.

If you’re unfortunate enough to become involved with a less-than-professional contractor, your chances of having a construction defect and the probability of an unsatisfied claim go up tremendously.  But how can you know if the contractor you’re considering is professional and reliable? One thing that can help you make that determination is knowing the warning signs that you may be dealing with a shady contractor.

Watch out for Slippery Salesmen

We want to be fair to the legitimate, hardworking contractor who employs competent, professional salespeople. There are plenty of good ones out there. But many of the contractor scams and horror stories you hear about involve slippery salesmen.

One all-too-common scenario involves the professional scam artist. His typical method of operation is to open an office and send multiple salesmen into working class communities to solicit home improvement business. The salesmen collect significant payments up front, the contractor performs little or no work, and when the mounting complaints threaten to bring the prosecutor to his door, he closes the office and disappears with everyone’s money.

Depending on how slick the operator is, he:

  • May have professional looking forms, brochures, and cards, and even a list of references (at least one of whom you can reach by phone but who is actually the contractor’s employee).
  • Could be “renting” a contractor’s license from a down-on-his luck contractor who has a spotless record. Therefore, checking the license reveals nothing unfavorable.
  • Might be able to produce realistic-looking insurance documents, though it is doubtful he actually has valid liability insurance.
  • May have a photo album of past work (but nothing that actually proves the jobs are his.)
  • Could be a member of the Better Business Bureau. The BBB does limited screening of members when they join. Primarily, they revoke a company’s membership after problems surface.

Of course, if your prospective contractor is not able to produce any of the above, you should be exceptionally cautious about doing business with him.  But even if he does have the appearance of legitimacy, proceed with caution.  Here are other signs to watch for.

  • The salesman has been going door-to-door in your neighborhood.
  • You cannot verify the contractor’s license or insurance information.
  • You have some doubts regarding the contractor’s references you’ve spoken to.
  • He claims to have materials left over from a nearby job and can offer you a good price on your project if you act quickly.
  • He offers you a discount if you agree to let your home be used for advertising purposes.
  • He gives you a price at your first meeting that is good only if you “sign today.”
  • You feel you are being pressured.
  • He offers you anything that sounds “too good to be true.”

Any one of these signs alone is not enough to prove the contractor is a scam artist, but if you encounter one or more of these, you should be sure you keep both hands on your wallet. Better yet, if you’re seriously thinking you’d like to have the work done, get bids from two other contractors for comparison.

The Lone Wolf

You may run into any variety of contractors who might fit the description of being a “lone wolf.”

  • Does not have an office.  Works out of his truck.
  • Has a bare-bones office, but no employees.
  • New to the area.  Just getting established.

This type of operator is risky because he has few ties to hold him down.  Because he has “no overhead” or he’s “just getting started,” he may be able to offer you an exceptionally attractive bid.   

But even if he does have a valid contractor’s license, liability insurance and good references, you want to proceed with caution.  Don’t give him any more money in advance of the work being performed than you’re prepared to lose.

Related Articles

Got something to say?





  • Contact Us

    *Required information
    First name*

    Last name*

    Male

    Female

    City*

    State*
    Zip code*

    Email*

    (At least one number is required)
    Home:

    Mobile:

    Work:

    Ext:

    How can we help?