Remodeling your home can be a huge undertaking, whether you're doing it for yourself or fixing it up before you put it on the market. If your project requires a contractor, we have some tips to help you avoid today's home improvement scams.
Don't Pay Up Front
It's okay to pay for part of the work beforehand and the rest upon completion, but any contractor who requires a full payment to start work is likely sub-par. They'll either leave town with your money or do part of the job and never show up again. In Nevada, contractors are only allowed to ask for 10% or $1,000 (whichever is less) at the beginning of a project. Other payments can be requested as work is completed.
Check with the Better Business Bureau
Visit bbb.org to research a contractor or business quickly. You'll find reviews along with letter grades from A+ to F, including NR (Not Rated). You can also check for complaints at your local Home Builders Association or visit usa.gov/state-consumer/Nevada to avoid a fraudulent contractor.
Look for Licensed and Insured Contractors
With the right coverage, you're protected if something goes wrong. That can include workers being hurt on your property or damage to your home. Check with your county or the state to confirm their license. To verify their insurance coverage, ask for information about the policy and call the insurer directly.
Don't Let Them Use Materials Left Over from Another Job
This likely means they are stealing leftover materials from a larger company and/or they will use whatever materials you purchase on their next job. You wouldn't want an auto mechanic to use leftover parts from someone else's vehicle just to save a few bucks. Why do it with your home?
Watch Out for the Home Improvement Loan Scam
In this scam, a contractor offers special financing in addition to an incredible price to remodel your kitchen or put on a new roof. Hidden in the paperwork is a contract for a home equity loan with a high-interest rate and fees. To avoid this scam, get more than one bid on a large job that might require financing. And don't borrow money from a company you don't know and trust. Instead, explore a One Nevada home equity loan or line of credit.
Demand References Before Signing a Contract
If the builder doesn't have any references or cannot share information about prior jobs for nearby homeowners, look for someone else who does. If you find a contractor who offers glowing references, verify them with a quick phone call.
Don't Skip the Permits
Yes, getting a project permit can slow things down, but a contractor who refuses to work with local and county building authorities could be hiding something. Look for a professional who understands why permits are necessary and how/when to request them.
Get Everything in Writing
Never hire anyone to do work on your home without a written contract. A contract should include:
- The contractor's name, address phone number, and license number.
- Estimated start and completion date.
- The scope of the job (materials needed and costs).
- A written statement of your right to cancel the contract within three business days before work begins.
If you've been taken by a home improvement scam, contact your local or state consumer protection agency. You'll find a list at usa.gov/state-consumer/Nevada.
One Nevada is Your Home for Home Loans
Our team of home loan professionals can help you finance your first or next home, refinance a home you already love, or access your equity to get a bigger project done right. Give us a call to chat about your options.