'Be Suspicious': Consumer Watchdog Breaks Down How To Avoid Tornado Repair Scams
After Sunday's tornadoes, many homeowners and businesses are trying to track down contractors and roofers. Dave Lieber, the watchdog columnist with The Dallas Morning News, says when choosing a vendor your consumer instincts should kick in — or you could run the risk of getting scammed.
Lieber shared some tips to avoid getting ripped off.
Your main piece of advice is be suspicious. Why is that?
You don't need any kind of license or registration or classes to be a builder, roofer or contractor in Texas. We're the only Gulf state that doesn't regulate these guys. So when there's a disaster like this, you not only get the really good competent builders, roofers and contractors, but you also get the scammers.
You said Texas doesn't offer many safeguards to protect home and business owners. Are there any protections at all?
There really aren't any protections. If you get ripped off by a builder, contractor or roofer, and it's under $10,000, you can go to small claims court and sue without a lawyer by yourself, like a "Judge Judy"-type of court. But if it's more than $10,000, you have to go to civil court — real court — and you have to have a lawyer. And even then, they may not pay anything. The other recourse you have is to go to police and prosecutors, but they hardly ever take these cases.
Minus those legal protections, what can consumers do to protect themselves and find an honest contractor or roofer or work crew? Should people just do an online search?
Well, that's one of many, many, many steps. You have to basically treat this person as if they're going to be a member of your family. You have to do a background check on them. You have to find out who they are, where they live, how long they've been in business, whether they're a member of the North Texas Roofing Contractors Association or The Builders' Association. You really have to get to know them and find out that they're good. You have to get references, and you have to get bids.
There's a whole lot of work involved in it, but you actually have to be a detective when you do this now. You just can't do it like in the old days where you pick a guy and you know the guy's going to come through for you, because every week I get a letter from somebody that explains that they lost tens of thousands of dollars to a contractor. The police won't help them. They can't afford a lawyer. They'll never see that money again.
Let's say I've done the research, I think I found my contractor or roofer. Are there any warning signs I should be looking out for in that process?
There's a new law in Texas that just went into effect on Sept. 1 that says that a roofer or contractor is not allowed to negotiate with an insurance company on your behalf. So if one of these guys comes to you and says, "Hey, I'll take care of the whole insurance thing, you don't even have to talk to them," he's violating the law, and you know right there that's a red flag, and you don't want to do business with him. Another red flag is if they're out of state. Because if you need a warranty in two years, where's the guy going to come back from — Louisiana — and help you out? They flood into the state when we have these disasters.
You suggest running a background check. How do people do that?
There's a website that I use called PublicData.com, which costs like $35 and allows you to look at criminal records. Some of these guys do have criminal records, so it's a really easy way to find out. The other thing you want to do is search their name and their city, the name of their company, reviews and comments, and the words "complaints," "fraud" and "rip-off," and see if anybody has used those words to describe any of their past work.
Once I've done my detective work and picked a contractor, what should I expect next? What are the protocols?
The main thing is do not give your insurance check to them right away. You've got to pay them in pieces. So maybe you want to give him like a 10% down payment, just to show good faith. Then, maybe a quarter of the way through or a third of the way through you want to give them another chunk, and then maybe halfway through or three-quarters of the way through another chunk. Then when the work is finally done and you're satisfied, then pay it off. If they don't accept that, then there's something wrong because that is considered to be the standard business practice. A lot of these guys just want the money up front so they can take off.
Once the work is underway, what should we be focused on at that point? Is there anything people should be looking out for?
Make sure that you get a warranty letter that shows the type of shingle used has a 20-year lifespan. Because if you don't have that letter, that warranty, then you can't show it to your insurance company, your insurance bill is going to cost more. The other thing is, while they're doing the work, don't be shy. Don't be scared of them. Hang around, watch them and make sure that everything is the way you want it. Don't let them leave without making sure that you walk around and look at everything.
Get more of Lieber's tips here.
Answers have been edited for brevity and clarity.