Colorado Design and Construction

As a homeowner, hiring a contractor can be a intimidating, especially if you have little to no experience in the construction field. There are countless stories of people being scammed by unscrupulous contractors who take advantage of their lack of knowledge and trust. Denver is no exception, with a significant number of homeowners falling victim to contractor fraud each year. According to the Better Business Bureau, contractor scams are the second most common type of scam reported in the Denver area. In this blog, we will discuss how to avoid hiring contractors that can scam you and the importance of being diligent in the hiring process.
What is contractor fraud?
Contractor fraud occurs when a contractor or company offers to do work for a homeowner but fails to deliver or provides subpar services. They often use high-pressure sales tactics or request payment upfront, and then either perform shoddy work or disappear altogether. Homeowners are left with a mess, and often with no legal recourse.
How common is contractor fraud?
Contractor fraud is a serious and common problem. As stated above, contractor scams are the second most common type of scam reported in the Denver area, after impostor scams. The National Consumer Law Center reports that in 2019, home improvement scams were the third most common type of consumer complaint, accounting for 10% of all complaints. These scams cost homeowners an estimated $1.8 billion annually.
How can you avoid hiring contractors that can scam you?
The number one way to avoid contractor fraud is to use the recommended trades on our website 🙂 But if those don’t work out for you, for whatever reason, the key to avoiding contractor fraud is to be diligent in the hiring process. Here are some tips to help you avoid hiring a fraudulent contractor:
1. Research the contractor. Look up the company online and check their reviews on sites like the Better Business Bureau, Google, Yelp, and Angie’s List. Be wary of companies with no online presence or few reviews.
2. Get references. Ask the contractor for references and follow up with them. Ask the references about the quality of work, timeliness, and overall satisfaction.
3. Check for licensing and insurance. Make sure the contractor is licensed and insured in the state of Colorado. You can verify this information on the Colorado Department of Regulatory Agencies website.
4. Get multiple bids. Get bids from at least three contractors and compare them. Be wary of bids that are significantly lower than the others.
5. Don’t pay upfront. Never pay the full amount upfront. A reasonable deposit is typically around 10% of the total cost of the project.
6. Get a written contract. Get a written contract that includes a detailed description of the work to be done, a timeline, payment schedule, and warranty information.
7. Don’t be pressured. Be wary of contractors who pressure you to make a decision quickly or use scare tactics to get you to sign a contract.
8. Trust your gut. If something feels off, trust your instincts and don’t hire the contractor.
What should you do if you have been scammed by a contractor?
If you have been scammed by a contractor, the first step is to file a complaint with the Better Business Bureau and the Colorado Attorney General’s office. You can also file a complaint with the Colorado Department of Regulatory Agencies. If you paid with a credit card, you can dispute the charges with your credit card company.
In conclusion, contractor fraud is a serious and common problem, and it’s important to be diligent in the hiring process to avoid being scammed. By researching the contractor, getting references, checking for licensing and insurance, getting multiple bids, not paying upfront, getting a written contract, not being pressured, and trusting your gut, you can minimize your risk of falling victim to contractor fraud. If you have been scammed, file a complaint with the appropriate agencies and dispute the charges if possible. Remember, prevention is key, so take the time to do your research and hire a reputable contractor.