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Selecting the Right Contractor How to Avoid Fraud, Bad Work, and Being Over Charged
Overview <ul><li>Any person or company working on your home should be licensed and insured to do the work described.  </li...
How to Avoid Fraud <ul><li>Just because your contractor has a business card and magnets on their truck doesn’t mean they a...
How to Avoid Fraud <ul><li>Check the BBB and State Licensing Board for complains against the contractor.  This can be done...
How to Avoid Bad Work <ul><li>Many contractors and handymen will perform work on your home in good faith, but aren’t exper...
How to Avoid Bad Work <ul><li>Ask to have copies of your building permit, a copy of your rough-in inspection for plumbing ...
How to Avoid Being Overcharged <ul><li>Many great contractors charge more than other contractors whose work is just as goo...
Good Practices to Protect Yourself <ul><li>Collect copies of all documents that go between you and the contractor, that th...
Additional Concerns <ul><li>Due to the nature of this grant, be sure to hire someone with experience in historical renovat...
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How to Not Get Ripped Off by a Contractor

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In the 6 years that New Orleanians have been rebuilding homes and lives post-flooding, thousands upon thousands have fallen victim to negligent or fraudulent contractors. As a non-profit that uses volunteers to assist with rebuilding houses, we have gotten many calls and assisted many homeowners who lost so much money that they were unable to continue rebuilding their homes.

We made this presentation at an information meeting about a grant that will be newly available to homeowners in the Mid-City area of New Orleans, but upon hearing new reports that people who were affected by Hurricane Irene are being taken advantage of, we realized that much of this information is universal to anyone who may have to hire a contractor for a major job on their home.

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Transcript of "How to Not Get Ripped Off by a Contractor"

  1. 1. Selecting the Right Contractor How to Avoid Fraud, Bad Work, and Being Over Charged
  2. 2. Overview <ul><li>Any person or company working on your home should be licensed and insured to do the work described. </li></ul><ul><li>Request copies of these documents before hiring the contractor and check that they are not expired. </li></ul><ul><li>Any quote you receive for work should be detailed with line items for each different task they will perform and what each task will cost. The details of work should be as specific as possible, including quantities, reference to code compliance, and how long it will take. </li></ul>
  3. 3. How to Avoid Fraud <ul><li>Just because your contractor has a business card and magnets on their truck doesn’t mean they are legitimate. Ask to see their ID and get a copy of it if you can. If they don’t have multiple forms of business stationary/paperwork with their name and logo and can’t show you and ID, they may not be who they say they are. </li></ul><ul><li>Many fraudulent contractors will ask for a high percentage of the money up front. Legitimate contractors can all afford to start with out receiving any money at all, or just a small down payment. </li></ul>
  4. 4. How to Avoid Fraud <ul><li>Check the BBB and State Licensing Board for complains against the contractor. This can be done online or by phone. </li></ul><ul><li>Ask to see work they are doing somewhere else and, if possible, speak to another one of their clients. </li></ul><ul><li>Ensure that you have a signed contract that details exactly what work will be done, how much money is due (and when it is due), what the procedure is for changing the scope of work or price. </li></ul>
  5. 5. How to Avoid Bad Work <ul><li>Many contractors and handymen will perform work on your home in good faith, but aren’t experienced enough to do the work properly. They may not be stealing your money, but certainly are wasting it if the work is not done right. </li></ul><ul><li>Do not hire friends of friends, family members, or neighbors to perform work just because they will do it for cheap. Most bad work is performed by someone who is friendly with the homeower and just doesn’t know what they are doing. </li></ul><ul><li>Do not attempt to do work yourself. </li></ul>
  6. 6. How to Avoid Bad Work <ul><li>Ask to have copies of your building permit, a copy of your rough-in inspection for plumbing and electrical, a framing inspection, a final inspection for plumbing, electrical, gas, and HVAC, and a final building inspection. </li></ul><ul><li>Ask for warranty on the work, which is usually at least 6 months for both labor and materials. This needs to be provided in writing. </li></ul><ul><li>Don’t assume that the cheapest quote is the best contractor. Good work will save you money in the long run. </li></ul><ul><li>Follow all recommendations related to avoiding fraud as well. </li></ul>
  7. 7. How to Avoid Being Overcharged <ul><li>Many great contractors charge more than other contractors whose work is just as good. </li></ul><ul><li>Always get at least 3 quotes and make sure the quotes cover the same scopes of work. Remember, the cheapest is not always the best, so you also have to consider quality. Do not be afraid to ask why something costs so much if it seems high. </li></ul><ul><li>Establish a set price in advance. If the contractor needs more money, they must get approval from you before they do the work and it should only be justified if they discovered something that needs to be fixed that they couldn’t have known about before they started. </li></ul>
  8. 8. Good Practices to Protect Yourself <ul><li>Collect copies of all documents that go between you and the contractor, that the contractor receives from permitting/inspections, copies of checks that you pay the contractor or receipts for any materials you provide. </li></ul><ul><li>The more detailed the contract, the more protected you will be. </li></ul><ul><li>Get as many quotes as you can before you start the work. </li></ul><ul><li>Don’t pay for anything until its right. If things aren’t going well early on, do not continue to pay just because they say they are due more money. </li></ul>
  9. 9. Additional Concerns <ul><li>Due to the nature of this grant, be sure to hire someone with experience in historical renovations. </li></ul><ul><li>Do not let your contractor store tools or materials on site overnight. You should not be responsible for if they are stolen and you do not want for theives to know there are valuables in you house. </li></ul><ul><li>Do not start work unless you have the funds to complete the work and do it properly. Most work that is performed and then abandoned will be stolen or damaged over time. </li></ul>
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