How You Might Be Overcharged By Contractors When Renovating Your Home

By on September 8, 2013

No matter how much care you take in selecting a contractor for your home, there is always a risks that the relationship does not turn out the way you hoped it would be. This is because being a contractor is not an easy job. The biggest challenge for such a business is always about cash flow. It is also a relationship that is prone to miscommunications and misunderstandings of expectations. Add that to what a mess it is to manage such a business, you are one lucky fellow if you have never had any issues with any contractors.

Contractor fraud can be termed as cheating against business or home-owners when executing renovations that are agreed upon. Most fraud happens during the repair works or electrical, plumbing or other civil jobs. The contractor proceeds to charge more or extort funds for doing the work. They’ll sell you second-hand or faulty parts, or invoice money for work never undertaken or completed. Be informed that a contractor without license violates fraud law, although these are interpreted differently according to the territory. The word fraud means deception of some kind. Contractor fraud doesn’t just mean shabby work. It is possible to haul up a contractor for executing bad work like contract breach or nonperformance or failure to comply with safety standards.

However, he cannot be liable unless there is obvious misrepresentation or he’s using the contract enterprise to extract more than the agreed amount. Fraud could be construed intentional, for the purpose of financial gain. Contractor fraud is commonly termed home-renovation or home-building fraud. It alludes to clouded money transactions pertaining to construction. For instance, a contractor agrees to renovate the bathroom, but doesn’t undertake the work. These people will ask for the whole agreed amount and disappear without executing any work at all.

work in progressIn other cases, a contractor will begin the renovation by breaking down the walls, pulling out appliances and such, but will then halt the work and demand additional funds to continue. They’ll cite unforeseen costs, blame expensive materials and, or, misunderstanding to justify why the extra money is needed to carry on the job. With the house in disarray, the owner has little choice but to cough up the money. He’ll have to shell out what the person wants. Many times, these scams reach double or maybe triple the agreed original amount. Identifying fraud before the fact isn’t that easy. Still, warning signs will emerge. For example, a person accepting only cash may not, in all likelihood, be genuine. Also, contractors insisting prices are valid only a few days, or limited time, is probably pressurizing his client to sign him on.

Suing the contractor is hardly productive. As the defendant can close shop and start a new company. By choosing this channel, you are losing money and time while hardly gaining anything back in return. The worst scenario is having your contractor disappear. Yes, it happens. You might wonder why anyone will disappear when they have your project on hand with profits to be made. When the simple answer is cash flow. As contractors take on more jobs that they can handle, a client who does not pay up timely can cause the contractor’s operations to come to a halt. There is simply not enough cash to carry on the works. It is not an easy business to manage.

A contractor without a government license is liable for questioning, as one unwilling to acquire necessary permits for the work he’s about to execute. Contractors not insisting on a written agreement or declining to list terms and conditions may not be genuine people. The way to protect oneself from fraud is being proactive when selecting a contractor. Ask questions and request for references. It is difficult remedying fraud once committed, but not impossible. Reporting the matter will be your first step. There are fraud laws in place everywhere, and governments won’t hesitate to prosecute contractor-violators. Governments have entities with specific fraud branches, where residents will be able to file grievances against contractors engaged in fraud. Online complaint forms are available. Once filed, your complaint will be processed and an investigation will proceed to prosecute said contractor. Remember, reporting a fraud will help prevent other home-owners too from undergoing the experience of being cheated by unscrupulous contractors. Are you being defrauded? Then report it right away to authorities so that action is taken and justice served



Related:

You May Also Like...

hair1 eye1 abs1
Access GOV-foreclosure property listings up for auction
Why friends look forward to your FAILURE
Give your resume a professional look for $5
Best EVER excuses for being late to work

Investors and homeowners receive our newsletters. Subscribe to our list.

Get More Real Estate Knowledge & Insights From Our Newsletters

Enter your email below