Numbers and Links to Know
FEMA Disaster Fraud Hotline: 1-866-720-5721
Texas Attorney General (for reporting fraud): 1-800-252-8011
File a fraud complaint with the FTC: https://www.ftccomplaintassistant.gov/#crnt&panel1-1Houston
Angie’s List contractors: https://www.angieslist.com/companylist/houston/contractor.htm
Tips from Texas Attorney General: https://www.texasattorneygeneral.gov/cpd/home-remodeling-and-repair
After any major disaster, fraudsters try to sell victims on phony repair deals, and they demand payment up front. As much as we want to believe that people are kind and good and wouldn’t take advantage of hurricane survivors, err on the side of caution when dealing with contractors.
Know what your insurance policy covers (if applicable). Know specifically what services and at what amounts they will cover those services.
Be proactive in selecting a company and not reactive to sales solicitations.
Use local companies that you’ve used in the past and trust or are recommended by relatives, neighbors, or friends.
Ask your insurer for recommendations if you don’t have a reliable contractor you’ve used in the past.
Avoid high pressure sales pitches. Although you may be anxious to get things back to normal, avoid letting your emotions get the better of you.
Never make a decision on the spot. Meet with several contractors then take your time to make a decision.
Check with the Better Business Bureau to make sure contractors are certified in Texas.
Verify if the business is insured. Once you have found a contractor, request proof of a current insurance certificate covering workmen’s compensation, property damage, and personal liability. General liability insurance should cover at least up to $1 million.
Ask how long they’ve been in business and if they normally work in this part of town, or if they’re driving in from somewhere else.
Ask contractors for references of previous customers.
Ask for names of material suppliers.
Get at least three detailed bids on work, so you know if you’re being overcharged.
Check with local authorities to find out whether permits are needed. The contractor should be aware of any permits or inspections that may be required and should secure them.
If your home is older, ask if the contractor is trained and certified by the EPA to conduct lead paint testing and to do “lead-safe” practices on pre-1978 homes.
Contracts and Payment
Don’t pay cash or write a check up front, or you risk scammers taking your money and running.
Pay in installments and wait until the repair work is completed to your satisfaction to make the final payment. A down payment should not be more than 1/3 of the total cost.
Your contract should specify the work to be done, the materials to be used and the price breakdown. Any promises made orally should be written into the contract, including warranties on materials or labor.
Your contract should include: the contractor’s name, address, phone number, start and end dates for the work, and that the contractor will secure all necessary permits and approvals and the payment schedule.
Your contract should state how any change orders will be handled. Changes that affect the cost of the job should be written and signed by both parties.
Read and understand the contract in its entirety; don’t sign a blank contract.
If an arbitrator is named in the contract, research them to make sure they’re fair and honest. If you don’t like what’s named, insist on changing it.
Unless your lawyer reviews it, strike the contractor’s warranty clause. Agreeing to a warranty may limit your contractor’s liability, and may limit your options if there’s a dispute. Warranties often are loaded with exclusions and time limits that favor the contractor, not you. Frequently, state statutes provide better protection, which you forfeit if you accept less from the contractor
Save a signed copy of the contract for your records.
In Texas, you have three days to cancel any contract for a sale made at your home.
If you’re getting money from your insurer to do home repairs or upgrades, the Federal Trade Commission suggests that you never sign your insurance check over to a contractor. Instead, have your bank provide a Certificate of Completion (sample from Bank of America). This way, the bank will pay the contractor in phases, as each stage of work is completed to your satisfaction.
Ask the contractor to provide a lien waiver when the job is completed. A lien waiver is a statement that all suppliers and contractors have been paid for materials and labor.
Door-to-door solicitors. Especially be cautious of those who claim to have left-over materials from a job “down the street” or who do not have a permanent place of business.
Too-good-to-be-true costs or timelines.
Phrases like “don’t worry about the paperwork.”
No portfolio or relevant work history.
Unprofessional or bad attitude.
Asking for checks to be made out to the contractor personally instead of their company.
Contractor promises that insurance will cover everything (with no basis for that statement).
Be leery if a worker shows up on your doorstep to announce that your home is unsafe. If you are concerned about possible structural damage in your home, have an engineer, architect or building official inspect it. A good contractor won’t use scare tactics to pressure you into a sale.
Go with your gut. If you get even an ambiguous “bad vibe” from someone or wouldn’t feel comfortable with them in your home, look for someone else.
Con artists may pose as building inspectors and order immediate repairs that they can do on the side.
Con artists may also pose as government officials and demand a fee for processing emergency loan documents. Ask to see identification for anyone representing themselves as a government official. Phone the government agency to verify the identity of the official and whether there is in fact any payment of money involved.
There have been reports of FEMA inspectors asking for personal information or charging for services such as damage inspections or contractor repairs. This is a scam.
“Clean Home Certificates”
There is NO requirement for clean home certification. Scam artists have charged worried homeowners large sums to do an inspection and provide a “clean home certificate” they claim is required.
What we DO recommend is to document (with date stamped photos and written records) the clean-up procedure used and to keep a moisture log of moisture meter readings, showing that wood framing reached the recommended 15% moisture content before restoration. That can provide reassurance for the homeowner and to prospective buyers or renters in real estate transactions.
Some legitimate, licensed mold remediation contractors may provide a “clearance” report of the effectiveness of the remediation, but that’s not a certification nor required.
Next Step: Floodproofing