FEMA Warns Not All Contractors Are Licensed
Release Date: February 9, 2006
Release Number: 1606-133
» More Information on Texas Hurricane Rita
AUSTIN, Texas -- Whether they are architectural, engineering, electrical or general contractors, most building industry companies are honest. But disasters invariably attract scam artists, so consumers must be vigilant in protecting themselves, cautions Department of Homeland Security's FEMA.
"It's unfortunate, but disasters often bring scam artists into the area to take advantage of the situation," said Sandy Coachman, federal coordinating officer. "Some scam artists claim to be FEMA certified. FEMA neither certifies nor endorses any private-sector contractor."
Here's what to be mindful of:
- Beware of the phrase "FEMA Certified." This can signal a scam. FEMA does NOT certify or endorse any contractor.
- Get a written estimate. Compare services and prices before making a final decision. Also, read the fine print. Some contractors charge a fee for a written estimate, which is often applied to the price of subsequent repairs they make.
- Check references. Contractors should be willing to provide the names of previous customers. Call several former customers who had similar work done to make sure they were satisfied with the job.
- Ask for proof of insurance. Make sure the contractor carries general liability and workers' compensation insurance. If the contractor is not insured, the homeowner may be liable for accidents that occur on the property.
- Use reliable, licensed contractors. Call your local Better Business Bureau to inquire about a business before signing a contract.
- Insist on a written contract. A complete contract should clearly state all the tasks to be performed, all associated costs and the payment schedule. Never sign a blank contract or one with blank spaces. Make sure the contract clearly states who will apply for the necessary permits or licenses. Have a lawyer review the contract if substantial costs are involved, and keep a copy for your records.
- Get any guarantees in writing. Any guarantees made by the contractor should be written into the contract. The guarantee should clearly state what is guaranteed, who is responsible for the guarantee and how long the guarantee is valid.
- Obtain a local building permit if required. Permits may be required for site work, other than demolition and for reconstruction. Contact your local officials for permit information.
- Make final payments when the work is completed. Do not sign completion papers or make the final payment until the work is completed and inspected by the proper authorities to your satisfaction. A reputable contractor will not threaten you or pressure you to sign if the job is not finished properly.
- Pay by check. Avoid on-the-spot cash payments. The safest route is to write a check to the contracting company. A reasonable down payment is 30 percent of the total cost of the project, to be paid upon initial delivery of materials. Federal law gives consumers a three-day "cooling off" period for unsolicited door-to-door sales of more than $25.
- Canceling a contract. This should be done within three business days of signing. Be sure to follow the procedures for cancellation that are set out in the contract. Send the notification by registered mail with a return receipt to be signed by the contractor.
- Report problems with a contractor or fraud to your state Office of the Attorney General.
Consumers can find a list of state-licensed contractors and links to relevant sources. To file a complaint or verify licensed or unlicensed activities, register online or call hotline numbers.
TEXAS STATE LICENSING RESOURCES
OFFICE OF THE ATTORNEY GENERAL
P.O. Box 12548 Austin , TX 78711
1-800-621-0508
www.oag.state.tx.us
THE TEXAS DEPARTMENT OF LICENSING AND REGULATION
P.O. Box 12157 Austin , TX 78711
1-512-475-2871
1-800-803-9202 (in Texas )
www.license.state.tx.us
complaints@license.state.tx.us
THE STATE AUDITOR'S OFFICE
P.O. Box 12067 Austin , TX 78711-2067
1-512-936-9500
1-800-892-8348
www.sao.state.tx.us
TEXAS AT YOUR FINGERTIPS
www.texas.online.com
These agencies will be a critical resource in helping consumer guard against hiring illegitimate or unscrupulous contractors. Information is provided on specific licensing and permit issues. The websites also provides a means to search for contractors by location, areas of specialty and license number.
Rules worth repeating are, never pay in cash or pay more than a reasonable down payment before the work is completed, always check references and make sure the contractor has the necessary insurance to protect workers. State-licensed contractors will be more than willing to show potential customers their license.
FEMA manages federal response and recovery efforts following any national incident. FEMA also initiates mitigation activities, works with state and local emergency managers, and manages the National Flood Insurance Program. FEMA became part of the U.S. Department of Homeland Security on March 1, 2003.
Last Modified: Thursday, 25-May-2006 14:42:25