How to Avoid Home Service Scams and Fraudulent Contractors
Temp Services Editorial Team
Home Service Cost Experts
Home service scams cost Americans billions annually. From storm chasers to bait-and-switch schemes, fraudulent contractors prey on homeowners' trust and urgency. Learn the warning signs and protective measures that keep your money and property safe.
Common Scam Tactics
Door-to-door solicitation after storms is a major red flag—legitimate contractors are too busy with existing clients. Other tactics include 'limited time' pricing pressure, requests for large upfront payments, and quotes far below competitors. Scammers may also impersonate reputable companies or claim they have leftover materials from a nearby job.
Bait and Switch
A contractor quotes one price but the final bill is much higher. They may claim 'unforeseen issues' or simply present a higher bill upon completion. Protect yourself with detailed written quotes, change order procedures requiring written approval for additional work, and never paying the final amount until work is verified complete.
The Large Deposit Trap
Legitimate contractors may request a deposit for materials, but it shouldn't exceed 30-50% of the total job and ideally much less for small projects. Scammers take large deposits and disappear, or use your deposit to fund another job while yours sits incomplete. Pay by credit card when possible—you have chargeback rights.
Research Before You Hire
Google the company name with words like 'scam,' 'complaint,' or 'BBB.' Check online reviews across multiple platforms—a company with only 5-star reviews may have fake reviews. Verify they have a physical address (not just a P.O. box) and a local phone number. Established contractors have a trackable history.
Protect Yourself Legally
Always get a written contract that includes the scope of work, materials to be used, timeline, payment schedule, and warranty. In many states, you have a three-day right to cancel home improvement contracts. Never sign anything under pressure, and never let a contractor start work without a signed contract.
✓ Key Takeaways
- Never hire door-to-door solicitors, especially after storms
- Deposits should never exceed 50% and ideally be much less
- Get everything in writing before work begins
- Pay by credit card for chargeback protection
- Research the company online and verify licensing and insurance