Avoid Fake Unlicensed Contractors

Many people unknowingly hire fake unlicensed contractors for repair work at their homes, businesses and rental properties. Most people go through the yellow pages, Internet search engines or referrals to find and hire one. Once we find the right contractor or at least think that we found the right contractor, we meet and/or discuss with them the details of the project, cost, timing, duration, number of contractors involved, their background, skill sets and quality of work. Now that we have all or most of the necessary information, we can make a decision to either hire the contractor or move forward with screening the next one. If we decide to work with the contractor based on the information that we have been given by the contractor, we have to validate the information before signing a contract.

Some people may independently validate the provided information, but others may just jump to signing the contract without eliminating the possibility that they might be dealing with fake unlicensed contractors. The amount of validation that we might perform to avoid hiring fake unlicensed contractors will depend on our perceived risk and tolerance of it. What I mean by that is depending on our original source for research and finding the contractor, we may more or less be comfortable about their background and the information they provided. The source of an information has a lot to do with our trust level and risk rating. For example, if a trustworthy friend referred contractors to us, then we may consider the risk to be low with regards to fake unlicensed contractors. We may also not have a need for a background check since a) our good friend might have already done that, b) we trust our good friend and his judgment, and c) our friend can attest to the quality of the work performed.

Assuming that we found the contractor through less trustworthy channels such as the yellow pages or the Internet since anyone can advertise including fake unlicensed contractors, we have to be diligent when selecting and signing a contract with them. One of my family members had contracted a supposedly licensed contractor to fix the roof a rental building. The contractor had provided a name, license number and company address in the contract. For some reason, in the middle of the contract work, the contractor disappeared with the expensive tools that belonged to the homeowner. During efforts to recover the stolen tools, the homeowner realized all provided information were inaccurate and such name, address, and license number did not exist. If I hire a contractor and he lacks the proper tools for the job, that would be a red flag for me and put the contractor right in the list of potential unlicensed contractors. In this case, the homeowner trusted the contractor probably for his own reasons such as low price quote and based on information the contractor readily provided and never considered the additional risks that come with potential fake unlicensed contractors. In some cases, the risks might even be greater than losing the expensive tools. When we hire contractors, we sometimes let them into our house to do the work they were hired for and thus by hiring fake unlicensed contractors, we put our family, personal information and other valuables at risk because of our failure to check on them.

There are many ways to audit the background of the contractors some of which are listed here for your convenience:

1-check the status of his or her contractor license through the state contractor license board,

2-search for any potential complaints about the contractor or his company,

3-check his references and inquire about the quality of his work,

4- make sure you get a copy of his business card and perform a reverse lookup on the company phone and fax numbers as well as company web site address, and

5- if possible and depending on the size of your project, you may want to visit the company facilities.

For state license board web address to identify fake unlicensed contractors, visit the resources page.

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