Free Inspections, Speedy Repairs: Watch Out for Elder Fraud
If you’re a homeowner, you know the scenario: A stranger knocks on the door and points out something wrong with your house. Perhaps it’s a loose roof shingle, a dangling tree limb, peeling paint. They’re in the neighborhood and will fix your problems at a good price.
Be wary. In Maryland, an elderly couple lost $200,000 for expensive repairs to their home that were either unnecessary or never completed. In Massachusetts, three scammers offered to fix a small crack in an older adult’s stoop for $200. But then they ripped out the front steps without his permission and charged him $6,000.
These homeowners were victims of home improvement or handyman scams, a fraud that often targets elderly property owners.
Since 2007, 109,000 of these scams have been reported to the FTC. The victims are often older adults who came of age in a more trusting era, according to the National Council on Aging. Scammers may be further drawn to older targets because they possess a lifetime of savings. Individuals who have cognitive decline may be especially vulnerable.
Sometimes the scammers offer a “free” inspection as a way to get started. Such “inspections” inevitably point to supposed problems that the scammers offer to fix on the spot – as long as you pay them in cash, through a wire transfer, or with a prepaid debit card. Don’t be fooled. These fraudsters will likely take your money and you’ll never see them again.
To make sure you are not the victim of a home improvement scam, experts suggest the following steps:
Steer clear of unlicensed or uninsured contractors. Check with your local government to confirm a contractor’s license and ask the worker for proof of insurance. Better yet, ask the contractor for references. One best practice is to hire people who have done work previously for someone you trust.
Do research on a company you may hire. Go online and search the company’s name along with words like “scam,” “complaint,” “reviews,” or “investigation.” See if the Better Business Bureau or local Home Builders Association has any complaints on file.
Get more than one estimate – and get it in writing. A legitimate estimate should include the scope of work to be done, project start and completion dates, and total cost of the job, including labor and materials.
Insist on a contract and read it carefully before signing. Make sure all the blank spaces are filled in, including the contractor’s full name, license number, and company address. The contract should also give you the right to cancel. Don’t agree to work based on a conversation or a handshake deal.
Don’t pay the full amount before work is complete. In fact, some states limit the amount that a contractor can seek as a down payment, so you may wish to check your local laws to know what the company can charge in advance.
Make sure that contractors, whether legitimate or illegitimate, don’t leave a lien on your property. Legitimate contractors may file a lien on your property to ensure they get paid, especially for large jobs. These are referred to as ‘mechanics liens.’ You should take steps to keep an eye on your real state and monitor for any unauthorized liens and/or title changes.