Are you ready to find a contractor to begin your home repair, remodel, room addition, re-envisioning, or ADU/JADU project? Then don’t make your selection until you take the time to read this blog.

How NOT to get Burned – 10 Ways to Spot Imposter Contractors

Protect Yourself/Your Property – Know the 10 Warning Signs of an Imposter Contractor:

If more homeowners, as well as business owners, commercial property owners, and farmers, heeded the 10 warning signs of an “imposter contractor” – who is typically only there to make their money and run – ALL property owners could be better protected and safeguarded against undue legal and financial harm. Additionally, reputable, actively-licensed contractors – who are doing proper construction and following all the state licensing rules and requirements – would be regarded respectfully, and valued accordingly, for their efforts.

Unfortunately, highly responsible and reputable licensed contractors get unfairly lumped-in with the imposters. Regrettably, imposters can easily win your business by simply offering lower construction project prices than an actively licensed contractor. Please beware of “low-ball” price points!

Licensed contractor bids SHOULD be similar in terms of price points because construction project pricing is based on prevailing market rates for labor, materials, and every common detail of your particular project. When you accept a bid that is noticeably below other contractor prices, please take a moment to ensure you are aware of whom you may be dealing with.

An unlicensed contractor, handyman, or a contractor with an expired license, is NOT the right person to hire for serious construction projects like a modern kitchen or bathroom remodel, addition, outdoor living spaces, an ADU/JADU, or for any critical repairs or new construction on your property. You are taking a serious legal, financial, and safety risk when choosing to work with imposter contractors. Unlike licensed contractors, imposters are under no obligation to carry liability insurance, to provide their workers with workers compensation insurance, to follow accepted construction techniques, pull permits, or adhere to current building codes – all things that provide you with legal and financial protections, ensure your safety, and that preserve and protect your property investment and resellability!

Some imposters will insist upon collecting their “full payment” up front. This is often because they claim they’re offering you a “discounted price.” They’ll happily take your money, but realize they may abandon the project prior to completion. And, without proper state licensing as contractors, you are left without any legal recourse, consumer protections, or means of financial recovery.

We often see handymen claiming to be licensed, yet there is no specific “handyman license” – and a business license is merely a “tax,”  NOT a valid contractor’s license! For any jobs totaling $1000 or more (labor and materials) a state contractor’s license (CSLB) is required! And any construction work requiring a permit (electrical, plumbing, structural), or if employees are hired, necessitates a valid contractor’s license!  Unlicensed handymen can do smaller projects under $1,000 that don’t need permits, but they should NOT advertise as “licensed,” or seek to break a big construction job into smaller parts to try to get around the $1000  limit. 

So, to be safe, please heed and share widely these 10 Warning Signs so all may know and benefit from this valuable information. With greater understanding and awareness comes the power to choose wisely!

1. Ask for evidence of an active license, bond, insurance, and no past complaints.
   Always look for, or ask for a contractor’s license number, and then visit the CSLB website to check that the license number for your contractor is current and active. Click through to examine the license details: business information, license status, classifications, bonding information, and worker’s compensation. Check to ensure that the contractor’s business name is exactly the same as listed on the CSLB. Ensure that the owner’s name is clearly the same person, and not someone else. Verify that the contractor is both bonded and insured. Do they have workers compensation insurance to cover their construction crew? Check for any prior licensing problems or consumer complaints. These simple steps will help you avoid potential problems and ensure proper legal safeguards when choosing a contractor.
   
   
2. Beware large price variations between identical project estimates.
   Carefully review estimates of work (project pricing) so that you know you are evaluating true equivalents – apples to apples, not apples to oranges. While it is wise to request 3 bids for any sizable construction project, the prices for residential construction should not be vastly different between licensed contractors if the project parameters are identical. Within any given area, labor and materials costs are fairly standard and consistent. The real difference between licensed contractors with equivalent skills tends to be their personal style and any added services. Great contractors respectfully and reliably provide great service. If one contractor provides a vastly different price estimate, ask why. Are they adding more to the project? Or, did they cut something out to try to win your business? By providing the same project parameters, fair and accurate price comparisons are possible. Prices will typically be closely aligned when you are working with trustworthy general contractors who are legally able to undertake most any construction project, especially anything involving building permits. Review all paperwork provided to ensure your clear understanding. Remember that whatever you sign will become your binding contract.
   

Avoid those operating without a written contract or a clear change order policy.                                 Actively licensed professional contractors provide clear contracts and change orders for extra work or any project changes, that outline the job, construction process, and associated costs. They clarify how any problems or concerns will be handled. They describe how issues that can arise will be managed, and they provide information regarding any contingencies. If your contractor fails to provide you with a written contract, you can lose legal protections should something go wrong. Never proceed without a written and signed agreement.

Don’t work with anyone who demands upfront cash or payment in full.            
Imposter contractors may demand cash upfront with the excuse that they can only offer their lower pricing in exchange for immediate payment. Unfortunately, you are at risk of that individual running off with your money and the project never being started or completed. No reputable, actively licensed contractor will ever ask you to pay them in full! A deposit for materials, and payment upon project milestones, is common. Once you have a mutually agreed upon signed contract, a deposit or partial payment is common and appropriate. Beware any cash payment requests coming from a salesperson, project estimator, or other unlicensed party.

3. Avoid low bidders – beware prices well below other licensed contractors.                                            The best price is seldom the best contractor, especially if the price is notably lower than other contractors. Going rates for construction are set by the market and wide deviations are warning signs/red flags. “Low ballers” tend to cut costs on quality and/or rely upon construction shortcuts that will fail to meet current code. Low pricing is also indicative of an imposter who is operating on the fringe or without a license, bond, insurance, etc. This places you at high financial and legal risk. Doing business with such individuals will come to cost you more in the end when you either get substandard work, need to have the project redone, or they walk away with your money yet never complete the project.
   
4. Avoid “special” pricing that requires you “pay now” or “sign today”.   Special prices for construction, or claims that you will be a “demonstration project” that insist you must “pay” or “sign now” are all red flags and signs of questionable or corrupt business practices and/or unlicensed imposters trying to win your business yet unable to deliver to the accepted construction industry standards. With but minor exception, prices for construction adhere to a standard set of costs among legitimate licensed contractors. Pricing offers that vary widely from reputable licensed contractors are “proceed at your own risk” situations for homeowners. These don’t tend to go well, and give rise to “consumer complaints” that are wrongly leveled at legitimate licensed contractors who actually NEVER play misleading and egregious pricing games.
   
5. Avoid those without customer references. Reputable, reliable, and hardworking licensed contractors typically have a number of clients happy to sing the praises of the contractor who remodeled and beautified their home. Many of these customers post positive reviews, happily agree to have their homes photographed, and their personal testimonials appear on the contractor’s website or in social media posts. Unless you have an especially unusual or unique remodel plan for your home that makes a reference to a “like project” customer somewhat challenging, your contractor should be able to provide you with references you can call. Not everyone may return your call in a timely manner, but seeing photos of actual work and speaking directly with a referral customer can help put your mind at ease. Choosing a contractor that will work well with you, respect your special accommodations, and who is reliable – these are key criteria for contractor selection. You will be spending a stretch of time (from several weeks to several months depending on the project size) working with your chosen contractor. Make certain their communication style and personality works with you and will suit your needs.
   
6. Avoid those who prove difficult to contact and lack transparency. Professional licensed contractors maintain a working phone, email, office, and web address. Lack of transparency, inability to reliably make contact, or any difficulties you experience in having your questions addressed or calls returned should be treated as suspect! Open communication, reliability, and integrity are key to a happy experience with a remodel, home repair, or renovation project. Be sure to avoid those who do not maintain openness and transparency.
   
7. Avoid those who tell you to “get the permit for them.” Licensed contractors do not hesitate to submit architectural or structural engineering plans for review to the city, county, or state. And they will happily procure necessary building permits. If you find that you are being asked to “get the permit,” that is a sure sign that you are working with an unlicensed contractor. Ask the question, upfront, as to who is expected to handle plan reviews and permits. This answer will be very telling!

10. Always check with the Better Business Bureau for consumer complaints.                                            Do your research and choose the licensed contractor with whom you feel the most comfortable. Should you have any doubts or want to ensure you’ve selected someone reliable and skillful, it takes but a moment to check the Better Business Bureau to see if a particular contractor has any record of lodged consumer complaints. You can also find customer reviews at the BBB website to help you better assess a contractor. Select businesses earn BBB Accreditation by undergoing a thorough evaluation and upholding the BBB Accreditation Standards. BBB assigns ratings 

from A+ (highest) to F (lowest). Choose accordingly.

This blog is the final part in an important 10 part series that encourages homeowners to “Beware of Imposters.” This special blog series is focused on helping California homeowners identify and avoid unlicensed contractors, who we refer to as “imposters.” 

Find the Right Contractor for Your Home Remodel (Beware of Imposters Part 1 of 10)

Finding the Right Contractor for Your Home Improvement Project (Beware of Imposters Part 2 of 10)

Helping Homeowners to Find the Right Contractor (Beware of Imposters Part 3 of 10)

Finding the Right Contractor for Your Home Construction Project (Part 4 of 10)

Finding the Right Home Improvement Contractor (Part 5 of 10)

Beware Imposters Masquerading as Competent Licensed Contractors (Part 6 of 10)

Beware Imposters: Surface Beauty ≠ Safe or Building Code Compliant (Part 7 of 10)

Safeguard Your Home Investment: Contract with a Licensed Contractor (Part 8 of 10)

For Your Home Construction Projects Be Sure To Contract With An Actively Licensed Contractor (Part 9 of 10)

Ed Neir Construction, founded in 2009, is a reliable, current, BBB A+ rated, and actively licensed general contractor offering expert project management skills, superior craftsmanship, and professional grade reliability. Call or text Ed Neir today to arrange for a free estimate: 707-999-5878 (license #: 928715).

Ed Neir, General Contractor
License #: 928715