FTC Warns of Post-Disaster Potential for Home Repair Rip-Offs

FTC Warns of Post-disaster Potential for Home Repair Rip-offs

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The Federal Trade Commission has issued a Consumer Alert, “After a Disaster: Repairing Your Home,” that warns consumers of potential “home repair rip-off artists” who may overcharge, perform shoddy work, or skip town without finishing the job. After a natural disaster, the demand for qualified contractors usually exceeds the supply. Because many legitimate companies are booked for months, frustrated consumers may not take the necessary precautions when hiring contractors.

The alert, available at http://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt030.shtm, urges consumers looking to repair their homes after a natural disaster to follow these tips:

  • Deal only with licensed and insured contractors. Verify the contractor’s record by contacting recent customers.

  • Ask friends, family, or insurance agents for recommendations. Check with the local Better Business Bureau and Home Builders Association to see if any complaints have been lodged against the contractor.

  • Take your time before signing a contract. Get a written estimate that includes all oral promises made, but make sure to ask if there is a charge for an estimate. Do not automatically choose the lowest bidder. Obtain a copy of the final contract.

  • Resist dealing with a contractor who asks for the entire fee up front. A deposit of one-third of the total cost is standard procedure. Pay by check or credit card only after the job is completed to your satisfaction. Do not pay cash.

  • Be skeptical of contractors who encourage you to spend a lot of money on temporary repairs.

  • Ask a knowledgeable friend, relative, or attorney to review the contract before
    signing. If you get a loan to pay for the work, be cautious about using your home
    as security. Consider asking an attorney to review the loan documents.

If you suspect a repair rip-off, call the consumer division of your state attorney general. If you suspect fraud, waste, or abuse involving Federal Emergency Management Agency (FEMA) disaster assistance programs, report it to FEMA’s Inspector General’s Office.

To order copies of this or other FTC Consumer Alerts, visit www.ftc.gov/bcp/online/pubs.bulkordr.htm. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint, or to get free information on consumer issues, visit www.ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure online database available for hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.



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