Use Caution When Hiring Contractors For Disaster Repairs
Release Date: November 21, 2002
Release Number: 1443-11
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Columbus, MS -- State and federal disaster recovery officials are advising Mississippi residents who have disaster-related damage to be extremely careful when hiring contractors to clean up and repair their homes and businesses.
"In disaster situations, scam artists are often ready to take advantage of the misfortunes of others," State Coordinating Officer Leon Shaifer said.
"The recovery process can be a positive one if you take your time, talk to building and code enforcement officials, and select a contractor with great care," added FEMA Federal Coordinating Officer Michael Bolch.
The Mississippi Attorney General's Office and the Better Business Bureau offer the following "Consumer Beware" suggestions:
- Use reliable licensed contractors and hire locally if possible: Check with the Better Business Bureau of Mississippi at 800-987-8280 and local business organizations for outstanding complaints against contractors. Check references and call the City of Columbus Building Department at 662-328-3463 to see if a contractor is properly registered. In the county, contact Lowndes County Office of Building Permits at 662-329-5860.
- Get a written estimate: Read the fine print and compare several competing services and prices before settling on one contractor.
- Ask for a written contract: NEVER SIGN A BLANK CONTRACT. Identify all tasks to be performed, all associated costs, payment schedule, and who applies for necessary permits and licenses. Have a lawyer review the contract if substantial cost is involved. Keep a copy of the signed contract.
- Ask for a written guarantee: This should state what is guaranteed, who is responsible and how long the guarantee is valid.
- Get proof of insurance: Make sure your contractor carries general liability and workers' compensation insurance.
- Pay by check: Avoid on-the-spot cash payments. It is best to write a check to the company. Thirty percent of the total cost is a reasonable down payment. If a contractor insists on an advance payment for materials, make the check out to the supplier, or to both the supplier and the contractor.
- Have work inspected: This is especially true for sewers or basement walls before they are hidden from view.
- Don't make final payment until the work is done to your satisfaction. Be sure to obtain lien waivers to ensure that no one who supplied materials can put a lien on your home because the contractor did not pay them.
- Be alert if you are offered a price that is far less than other bids received.
- Price gouging -- unreasonably high prices for products and goods, especially for items in short supply -- should be reported to the Mississippi Attorney General's Office, Consumer Protection Division, at 800-281-4418. Information also is available at their web site: www.ago.state.ms.us.
- If necessary, cancel a contract within three business days of signing, being sure to follow contract cancellation clauses. In Mississippi, the consumer has three business days to cancel a contract if it was made at your home or away from the contractor's primary place of business. Send notification of cancellation by registered mail.
People who are having problems with a contractor or who suspect fraud are urged to call the Consumer Protection Division at 800-281-4418.
Last Modified: Monday, 21-Apr-2003 09:43:34