Scam of the Month: Contractor Scam Awareness


As many of us live longer, it can become more difficult, both physically and financially, to maintain a home. Contractors know this and those who are scammers choose to take advantage of older homeowners. How do you tell if a contractor is a scammer? Here are five “red flag” warnings that you’re being scammed.

  • Pay Me First: According to the Better Business Bureau, this is the most common scam reported. The contractor will tell you that materials and equipment will need to be ordered. Once you hand over the money, a couple of things can happen: they disappear or they complete the work carelessly.
  • Trust Me: You have hired a contractor, discussed the work you want to be completed and the contractor agrees. Now it’s time to sign the agreement. You notice some of the requested work and details are not included. The contractor says “trust me- I’ll take care of it” but it’s not taken care of. Now the contractor tells you that he did not include those extras in the quote and you will have to pay more money.
  • We Don’t Need a Permit: Any significant construction project requires a building permit. This allows officials to visit occasionally to ensure the work meets safety codes. Dishonest contractors will try to tell you that a permit is not required. Others will try to have you take out a homeowner’s permit. That would mean lying to authorities about who is doing the work, thus making you responsible for monitoring inspections.
  • Unexpected Problems: The construction has started or even finished and suddenly the contractor tells you there were unforeseen issues like termites and now the price has skyrocketed. Sometimes additional fees are legitimate, but other times dishonest contractors will bid very low to get their foot in the door and then increase the price later.
  • Extra Materials: This fraud usually comes from paving companies, roofers, or painters. They tell you that they have extra materials and they can perform the work dirt-cheap. A few things can happen. One, they actually do not do the work and take off with your money. Two, they start the work and the job is more complex than they thought and it will cost even more. Third, the work is completed carelessly and in one your your roof leaks or your driveway cracks.

Here are a few suggestions on how to keep from being a victim of contractor fraud:

  • Hire contractors currently licensed with the TN Board of Licensing. Call 1-800-544-7693 to verify the license. You can also ask if they have had any complaints.
  • Ask the Board of Licensing if the contractor has paid the insurance bond. This will protect you if the company goes our of business or does shady work.
  • Use word of mouth. Ask friends and neighbors for suggestions of quality contractors.
  • Ask for references and then verify.
  • Avoid using a contractor that only has a PO Box or answering service.
  • Call the Better Business Bureau at 615-242-4222 or TN Consumer Affairs Division at 615-741-4737 to see if any complaints have been filed against a company.
  • Always get more than one bid from different contractors.
  • Never hire “on the spot”.
  • Never accept a verbal agreement… get it in writing!
  • Avoid contracts with blank spaces and make sure the contract includes a license number, address, and phone number, detailed work description, list of materials, estimated completion date, price, method of payment, and if there is interest to be paid.
  • Read the contract.
  • Never pay cash.

Source: Legal Aid Society of Middle TN and This content brought to you in partnership with AgeWell Middle TennesseeAgeWell Middle Tennessee champions informed and positive aging and serves as the area’s catalyst for collaborative solutions. Visit their website to learn more about the work they are doing and how you can get involved.


 2 years ago by Fourth Capital

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