How to Recognize 6 Common Contractor Scams—Before You Get Ripped Off

It’s hard enough settling on the right tile for the bathroom remodel or reaching a compromise with your significant other on the new cabinets for your kitchen. You don’t need to throw a shady contractor in the mix.

While many contractors are honest, hardworking, upstanding citizens like you and me, the industry isn’t without its bad apples. If you’re not careful, you could fall prey to one of these scammers and schemers—and wind up holding the bag for thousands of dollars of repairs.

That said, there are some telltale signs that you have a nefarious contractor in your midst. Here are a six tip offs that you may be on the receiving end of a scam.

woman meeting with contractors

They Ask for a Large Payment Upfront

It’s not uncommon for a contractor to ask for a payment before they begin a job. Shelling out a small percentage of your quoted costs is kind of like putting a down payment on a house or a car. However, the key word here is “small.” Any contractor who requires you to pay 100% of their estimated price could be planning to cut and run before the ink on the check is dry. Ten percent—or $1000 for a smaller project—is a more realistic amount. If your contractor asks for anything more, you could have a scammer on your hands.

They Offer to Pay Your Deductible

This one is most frequently seen with roofers. The scam runs like this: a roofer tells you to file a roof repair claim with your insurance company for storm-related damage. Don’t worry, though, they say—they’ll refund your deductible once the money comes in, or they offer to waive the cost entirely. If that sounds too good to be true, rest assured, it is. Scams like these constitute insurance fraud, and if discovered, could get you blacklisted from purchasing homeowners’ insurance for years. Take a word from the wise and and avoid any roofer that promotes a scam like this.

They Quote You a Price That’s Way Below Other Bids

A cutthroat price on a home project might seem like a dream come true—but if a contractor comes in way below competing bids, that should raise a big red flag. Scammers often use a super low quote to lure you into accepting their bid, then suddenly raise the price once the contract is signed. They might tell you the market cost for materials has gone up, or that an unforeseen issue has come up. It’s a bait-and-switch tactic that contractors use to squeeze more money out of unsuspecting homeowners. Always get at least three bids before settling on a contractor—and if one of the prices seems way off, ask that contractor to explain why the price is so low.

They Tell You “No License/Insurance/Permit Necessary”

A contractor who offers a discount for unlicensed or uninsured work is just a disaster waiting to happen. If anything goes wrong, you’ll be the one left on the line for damage. Same thing goes for permits. A very small project may not require a permit, but most do, especially the job includes demolition, electrical work, or plumbing. Skip the permit and you could be looking at a fine. Also, it’s a pretty fair assumption that your contractor is using unqualified labor to make their repairs. Check licenses and proof of insurance before work begins—and make sure your contractor pulls any necessary permits well in advance.

They Come to You

Be wary of any contractor who goes door-to-door looking for work. In this scam, contractors show up at your doorstep, telling you they can get you a scandalously low rate on driveway paving, siding replacement, fencing or a new roof. Why the low price? Well, they just finished a job down the street and happen to have some extra materials. They noticed that you need a new driveway/siding/fence/roof/whatever and wondered if you might be interested. If you hear this, all the alarms should start going off. Usually it means they have recalled, stolen or low-grade materials they’re trying to offload. And they’re planning to install them as quickly as possible and leave you holding the bag for their poor workmanship. Don’t fall victim to these scammers. Tell any contractor who comes to your door to amscray.

Something Just Feels Off
You can’t put your finger on exactly what it is, but something about your contractor just strikes you as… not right. Maybe they seemed a little rushed when they handed you the contract. Maybe they looked nervous when you first met, or they’re way too hard to get a hold of these days. Whatever it is, trust your instincts. If something feels off, it probably is. It’s fine to look for another contractor if you need to—after all, it’s your home!