How to avoid being scammed by a general contractor

April 25, 2021 by No Comments

As an executive in the construction industry, I have witnessed some shady deals and seen some contractors try to scam clients. I find this offense on many different levels. There’s no reason to be dishonest, he always comes back to bite you where the meat is tender, hurts others, ruins reputation, and soon ruins the whole business.

I have consistently found that dealing honestly with clients has expanded our business and created lasting friendships.

In addition, I firmly believe in reaping what is sown, and that what is given, is given.

I don’t know about you, but I prefer to create a happy and pleasant future, than one in which I have no friends, my reputation (if I have any left) is in tatters, and where I may face some bad guys. temperate magistrate.

Our general contractor (GC) ran into another rogue contractor this morning and came back to the office in pretty shape, so he decided he needed to do a little more, use my knowledge to warn unsuspecting homeowners. Someone warned me that I could make more enemies than friends in my business. I don’t believe that for a second, because I know a lot more honest people than dishonest ones, and if they later decide not to like me, I will tend to think that I have successfully warned some owners and saved someone a heartache and money .

There are a number of ways a rogue contractor can try to scam you.

1- Give the homeowner a very low ball estimate.

A perfect example of this is this morning’s story that I referred to earlier. We had submitted an estimate to build a small kitchen in an unfinished basement. The owner told our GC that she was absolutely amazed that our estimate was three times that of another contractor.

Let me tell you that there is absolutely no way to do this job for a third of the price we gave it. Our estimate for a kitchen included demolition of an existing room, framing the walls, electrical roughing and finishing, plumbing, HVAC including all fixtures, exterior wall insulation, drywall, paint , tile floor, tile backsplash, kitchen cabinets and island, granite countertops, all appliances, labor and supplies for everything listed. You get the idea.

But this “low ball” is not a new tactic. Your purpose is to get the job and then start adding costs while the job is being done, claiming incidentals, change orders, or situations.

Once an owner is in the middle of a project, it is very difficult to fire an existing contractor and take the time to find a new one.

Solution: When you see a large price discrepancy between two estimates, get a couple more offers. This will give you a very good idea of ​​what the job should cost. There is absolutely no doubt that every project must take into account unforeseen circumstances, i.e. mold is found on the walls during demolition, the house is old, and the electrical wiring is out of code, previous work is of poor quality and it is not known until it is reviewed again. . Unfortunately, the list is long. But most of the time, an estimate can give you a very good idea of ​​what the cost will be.

2- Do not pay subcontractors and keep the money.

Although this scenario may not be as frequent as the first one described, it does occur. The general contractor hires subcontractors and keeps all the money. This leaves the owner holding the bag and the links are filed against the house. It can result in costly and lengthy legal battles and skyrocketing stress levels.

Solution: Ask your contractor for some references from previous clients. Find out if complaints have been filed against you with your state licensing department.

3- Scandalous remodeling estimate.

This unethical practice is used by contractors looking for clients who have no idea of ​​construction costs. This method doesn’t work for most people, but it is done enough to be lucrative for some businesses, similar to how an auto mechanic scams someone who knows nothing about auto repair.

Solution: Get more than one estimate.

4- “The discount for friends and family”.

The work is offered to be done after hours and on weekends as a favor and at a reduced rate by someone who does not have a license or insurance. In this scenario, rest assured that no permits will be withdrawn or inspections will be performed. In addition to the fact that this practice is completely illegal, it directly affects the issue of safety, the electricity is of poor quality and is a fire hazard, the plumbing does not meet the standards and causes the pipes to break and flood, for name just a couple of possible branches. This can also negatively affect the resale of your home and reduce the value of the property.

Solution: Hire a reputable licensed and insured contractor. It takes very little time to search the Internet for your contractor and contact your state licensing department to find out if the business is properly registered and if complaints have been filed.

5- Cause damage to create more work.

The unethical contractor damages something in the house and claims that it needs to be repaired at an additional cost.

Solution: Any damage caused by a contractor or subcontractor is not your financial responsibility. A contractor is legally expected to repair and pay for any damage caused while on the job.

Additional signs that a contractor is dishonest:

1- Refuses to sign a contract

2- Accept only cash as a form of payment

3- You refuse to give references, or you refuse to provide a copy of your license and insurance.

4- It tells you that you will have to get the permits yourself.

Most contractors are law-abiding, decent, and do a good job. The few that fall into the category of dishonesty can be avoided by following the tips above.

I wish you an easy and happy experience while remodeling.

Leave a Comment

Your email address will not be published. Required fields are marked *