Avoid Getting Scammed: 9 Warning Signs of Bad Contractors

A large number of contractors are honest and professional, but 36% are frauds! It’s a homeowner’s nightmare to spend thousands of dollars on their home just to get scammed or a poorly done job.

Both of these outcomes will require more money to rectify the situation. To avoid such loss-making predicaments, it's essential to hire good contractors for your home construction or renovation.

How do you know if you've found a good contractor or one who will overcharge you for poor work? Arm yourself by knowing these signs of bad contractors.

1. Rushing the Hiring Process

A bad contractor will try and rush you to commit to hiring them so that you do not look into them. They will respond to your questions briefly and without logic explanations.

You’ll notice that they don’t make an effort to explain what they’ll offer. Instead, they repeat the same lines to you like some lousy commercial.

“We understand your needs and will ensure to complete the project successfully on time.”

Such contractors always entice you with words to speed your decision process so that they can move to the payment bit. The right contractor will answer your questions in detail, offer several options, advise you on the best solution, and give you time to make a decision.

2. Lack of Proper License, Insurance, or Permits

There’s something about being legit that makes you want to post your legal documents on your Instagram feed, right? Well, not with shoddy contractors. These guys don’t even like hearing the words license, permits, or insurance from a client!

To save your time, ask for a license and evidence of insurance the minute you meet them. Whoever does not flash them out in the first 5 minutes, forget hiring them!

Insurance is vital because, during construction, accidents happen, and you don’t want to add hospital bills on top of construction fees.

3. Absence of a Portfolio or Valid References

If they hand over their licenses, have insurance, and offer to get required permits for the job, ask them about their work history and references. Many contractors do not have the skill to complete the job to perfection. You don’t want to roll the dice on your house!

If they show photos of what they have done, ask them to give you contacts of those clients so you can verify their claims. You may need to go the extra mile and browse for online reviews. A stand-up company will register their business on review sites and have positive reviews from their previous clients.

4. Extremely Low Costs or Large Discounts

Who wouldn’t want an affordable deal for their home? Well, if you get a 2% discount off the original amount, we can understand. However, if the contractor is giving a 30% discount, start squinting. Heck, even a 20% discount is suspicious!

Construction takes so much time, labor, equipment, and miscellaneous costs. If a contractor is upfront charging low fees and offering massive discounts, then there’s something off about them.

This doesn’t mean that you go for those who will double the amount!

5. Bad Contractors Give Shallow Quotes

When it comes to getting a quotation, you can weigh the exact costs to see if they are worth it. Of course, if a contractor is up to no good, they’ll not bother to give details and estimates of each item and service.

If they are beyond corny, they’ll calculate the total amount of head, on the spot in less than 10 minutes. Now, some contractors have quotation templates and phone applications, making it easier for them to produce a quote on the spot.

You can filter such contractors in one way, by asking for a detailed quotation. If it took them ten minutes to come up with a quote, then it should take them five minutes to break down the details for you.

6. Requires you to Make a Large Deposit

After agreeing on the best amount for the job, a sneaky contractor will request you to make a large deposit. Deposits should range from 20% to 30% of the total amount.

Once you give them a deposit, the so-called-contractors will flee with your money. A sincere contractor will provide you with payment receipts after each payment.

As for the remaining 70%-80%, you should pay only when satisfied with the completed contract.

7. Refuses to Sign a Contract

Suspicious contractors avoid any law-abiding activities like getting permits or signing contracts. Putting down their signature on that paper means that they must deliver. Sadly, a con is up to everything but delivering expectations!

General contractors go out of their way to draft a contract after analyzing the job at hand. Candid ones will hand the draft to the client and advise them to go through it and discuss at a later date. This is because they understand how crucial signing a contract is; therefore, they give the client ample time to raise questions and discuss deals before signing.

8. Expects only Cash Payments

One common tactic with cons is asking for cash payments. No swiping, no checks, or bank transfers, only cash. That's how they stay under the radar, avoiding the IRS and evidence of the transaction.

Make sure you choose a payment method other than cash and keep copies of each transaction document for future references. The contractor might also suggest payment in advance either before the job starts or before they complete their job. As mentioned earlier, only pay once you do an inspection and are happy with the outcome.

9. Don’t Bother About Ground Rules

Mostly when it comes to renovating a house, a lot of ground rules come to place. Something as minor as a washroom for the contractors can cause misunderstandings. This is why it’s crucial to lay down ground rules and have both parties agree to them.

A fraudster doesn’t care about ground rules! This could be because they’re not even planning to start the job or are so bad at their jobs and don't respect homeowners.

Get your Home a Professional Contractor

Find a contractor with a physical address and ask them to walk you through their building or renovation process. A legitimate contractor will listen to your ideas and give you revolutionary tips to achieving your dream home.

Bad contractors are everywhere, so don’t brush off red flags just because they don’t 'appear' to be bad. For more home renovation tips, check out our décor posts.