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3 Ways to Avoid a Home Improvement Scam

Updated on April 29, 2011

When you turn on the local news or scan the national news stories, you’ll find homeowners across the nation, young and old, that are falling prey to home improvement scams. Unfortunately for consumers, scam artists are on the move, here today to take your money and gone tomorrow without completing your home improvement project. The key to avoid home improvement scams is to be aware. When you’re an educated homeowner, you know what to look for in a contractor and how to work with a contractor, so you don’t end up as part of a home improvement scam article in the newspaper or as a news story.

Obtain an Estimate in Writing

Scam artists tend to be nice people and people that seem to know what they are talking about. Niceness doesn’t cut it when they run off with your money. A professional contractor puts the estimate for the work in writing. This allows him or her to list out the work they will be responsible for completing and assigning a cost to each aspect of the project. A written estimate also allows you to carefully review it and ensure that everything you expect from the contractor is in the estimate. If you do not understand an estimate or there is information missing, then discuss this with the contractor and get a revised estimate. Do not approve an estimate until it is in writing and to your satisfaction.

Check and Verify

Since scam artists come and go, you may not have time to figure out the contractor has a bad reputation until it is too late. Before you hire a contractor, gather information from them up-front. Check with the state and/or the county business licensing office to ensure the contractor is licensed. Require a copy of the contractor’s liability insurance certificate. Ask the contractor for customer references and then check the references. When you do your due diligence, it ensures that you won’t fall prey to a home improvement scam.

Spread Out the Payments

Never pay a contractor all of the money for the project up-front. Most contractors do require some kind of a deposit up-front in order to book the job and buy any supplies they need to complete the work. Deposits can be up to 50% of the total project. Larger projects may have multiple payments based on milestones in the project completion taking place. Spreading the payments out into two or more installments helps to reduce the chance that you’ll be taken for a ride by a contractor.

You don’t want to end up as part of a local news or newspaper story featuring homeowners that have been scammed. When you use these tips as a guideline for hiring and working with a contractor, however, it helps reduce the chance that you’ll become a victim of home improvement scams. In the end, it’ll save you time, money and a big headache.


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