Be on the Lookout for Home Repair Scams and Shady Contractors Following Natural Disasters
Scammers and fraudsters are always active after a disaster hits and they don't care how they steal your money
Preparing for an approaching hurricane or other weather disaster is stressful enough without worrying about scammers who want to take advantage of the situation and steal your money in your time of need. If you find yourself in the unfortunate situation of needing repairs after a storm, know what to look for to help you separate good contractors from scammers and cheats looking for a quick payday.
Avoid Contractors Who Contact You
Scammers and shady contractors are always hard at work, even if no natural disaster has hit your area. But they are especially active after any kind of weather event that unleashes widespread damage because it's easy to blend in with the good guys and easier to get into your pockets. If a contractor calls you or shows up at your door and you did not request any services, you should turn away. Nearly all honest and legitimate contractors have a lot of work lined up and don't need to go out searching for it.
These types of scammers contact you after a storm and claim to be "doing work in your neighborhood." They work by pointing out obvious and often expensive damage to your home, as well as hidden damage despite doing no inspection. They might request large deposits or the entire cost of repairs up front. If you pay them, they may even start work as a show of good faith, often to get you to pay more money for other newly-discovered problems, before taking off with your money. They may even contact and/or take payment from your insurance company without completing work.
Never pay by check or cash
If you are working with a legitimate contractor, you might have to pay a reasonable amount of money upfront as a deposit for the work. But to protect yourself you shouldn't pay by cash or check, which you will have trouble recouping if your contractor takes off or otherwise does a bad job. Pay by credit card and only pay once the job has been completed and you are satisfied with the work. If you pay by cash or check and your contractor takes off or does a bad job, you will have a hard time getting that money back, even if you take the contractor to court and win.
Always get multiple estimates before committing to a job
When shopping for insurance, you probably aren't going to buy the first policy from the first company that quotes you a price. The same should apply to home repairs and virtually all other types of jobs. While it may be tempting to jump on the first bid for the job in order to start work sooner, you can probably save hundreds or even thousands of dollars by getting multiple estimates from multiple contractors.
Some contractors have higher labor costs than others. But there are contractors who inflate their costs after a disaster in order to take advantage of your desire for a quick resolution. So whether you have roof damage or a downed tree in your yard, get multiple estimates before committing to have the job done. You may also not want to share details of your estimates with other contractors since each estimate should be completed after a thorough inspection. In the end, you might find that one contractor is overcharging for labor or wanting to do work that other contractors feel isn't necessary.
Have a written contract with a guarantee
We always tell everyone to get a written contract for any agreement, not just home repairs. So make sure that you have a written contract that clearly states the terms, including exactly what the contractor will do, the prices to be charged, and when you are expected to make payment. If you don't have a written contract, good luck trying to prove your case if you have to take your contractor to court or if you need to have your credit card company reverse any charges. And when you do get a contract, actually read it before signing it. You might be agreeing to absurd terms. Reputable contracts will guarantee their work for a set period of time.
We still do some things with a handshake and a nod in the south. But home repairs shouldn't be one of those things. So if a contractor wants a handshake, look elsewhere unless you want to add more stress down the road with incomplete or bad repairs and no legal recourse. You should also avoid 'friends of friends' or 'this guy I know' type of contractors. Many of them don't do that type of work as a day job and probably aren't licensed.
Your Right to Cancel
Transactions that take place at a location that is not the seller's normal place of business are eligible under state law to be cancelled up to three days after you sign the contract. So if the contractor comes to your home, you qualify for this right. The seller should include instructions on how to cancel the agreement in the written contract. You must notify them in writing if you change your mind and wish to cancel within that three day period. It's a great idea to have proof of the cancellation.
Price gouging is illegal
North Carolina has one of the strongest price gouging laws in the country. Price gouging, or charging too much money in times of crisis, is against North Carolina law when a disaster, an emergency or an abnormal market disruption for critical goods and services is declared or proclaimed by the Governor or a municipality. But just because price gouging is illegal doesn't mean that unscrupulous contractors won't do it anyway.
If you believe you may have been a victim of price gouging, you should file a price gouging complaint form.
Other types of complaints
If you have a complaint about a contractor, you should file your complaint with the North Carolina Attorney General's Office as soon as possible. You may wish to report poor workmanship, overcharging, charging for work not performed, or charging for work that was not authorized. The Attorney General can take legal action against contractors who violate the law.
Be Especially Caution if the contractor
- Appears unannounced at your doorstep
- Call or emails you unexpectedly
- Shows up and say they are doing work in your neighborhood
- Makes you feel pressured to make a decision and sign a contract for the work immediately
- Offers a "special deal" that's only available today
- Shows you a problem that you've never seen before
- Shows you a problem that you are pretty sure wasn't there before the contractor arrived
- Wants full payment, especially if in cash
- Doesn't have identification or permits
- Offers you a discount if you find additional customers
- Offers to help with financing or insurance claims
- Insists you leave your home to inspect damage