Cuomo Administration Outlines Steps Consumers Can Take to Avoid Home Repair Scams

Governor Andrew M. Cuomo today issued a consumer alert warning homeowners to protect themselves against home repair scams, which may arise in the wake of the recent flooding that occurred on Long Island. The Cuomo Administration also outlined steps consumers can take to avoid these scams and warning signs for which they should on the lookout.

“Unfortunately, unscrupulous home repair scam artists often come out of the woodwork in the aftermath of major storms and try to take advantage of their neighbors,” said Governor Cuomo. “There are a number of steps that homeowners can take to avoid these schemes and help ensure they are engaging with reputable businesses.”

Benjamin M. Lawsky, Superintendent of Financial Services, said, “While most businesses are honest, there is typically an upswing in home repair scams after natural disasters. That is why it’s important to shop around for several repair estimates and get written contracts describing exactly what work needs to be done and how much it will cost. Homeowners should also just say no to anything that sounds suspicious or too good to be true.”

The Cuomo Administration urged homeowners to protect themselves by looking out for common warning signs of home repair scams. Homeowners should beware of anyone who:

• Comes to your home or calls you on the phone offering to make repairs.
• Tells you that you must make repairs immediately or offers discounts if you buy their services today.
• Pressures you to sign a contract immediately.
• Tells you that they are doing work in your neighborhood and that they have extra materials left from another job.
• Is not an established local business, but has come to the area from somewhere else to “help.”

The Cuomo Administration urged homeowners to avoid unlicensed contractors in areas where a license is required, such as Nassau and Suffolk Counties. In addition, homeowners are urged to avoid contractors who:

• Don't supply references or whose references can't be reached.
• Tell you there's no need for a written contract. By law, all contracts for $500 or more must be in writing, but it's a good idea to get a written contract even for smaller projects
• Only have a P.O. Box address or a cell phone number
• Cannot supply proof of insurance
• Ask you to get required building permits. It could mean that the contractor is unlicensed or has a bad track record, and is therefore reluctant to deal with the local building inspector. However, you should verify with your local building department that all necessary permits have been obtained by the contractor.
• Ask for money to buy materials before starting a job. Reliable, established contractors can buy materials on credit.
• Demand payment in cash or want full payment up front, before work has begun. Instead, find a contractor who will agree to a payment schedule providing for an initial down payment and subsequent incremental payments until the work is completed.

Homeowners who believe they have been victimized by scams should consult a lawyer immediately. There are time deadlines to cancel sales and pursue legal claims. Homeowners can also contact the Department of Financial Services for insurance-related scams, or the offices of their county’s District Attorney or the state Attorney General.

Homeowners with disputes involving home improvement contractors can file complaints with the New York State Department of State at www.dos.ny.gov or by calling 1-800-697-1220.

Consumers should contact their insurance company, agent or broker to get answers to specific questions about insurance policies or claims.

Consumers who need further insurance-related help should feel free to contact the New York State Department of Financial Services’ Consumer Services Unit at 1-800-339-1759.

Some suggestions for safe ways to find a contractor to repair your home include:

• Check out contractors. Is the company reputable? How long has it been in business? Ask for references and then check them out. Make sure the company is licensed, bonded, and insured. Ask to see its insurance policy or certificate of insurance. There are on-line resources for finding out other people’s experience with contractors.
• Insist on a written contract that includes a detailed description of the work to be done and specifies exactly what materials will be used and their quality. The contract should include starting and estimated completion dates. The terms, including the price, finance charges and payments, should be what you agreed on. If not, do not sign it. Be sure to get a copy of everything you sign when you sign it.
• Ask if there is a guarantee or warranty. If so, make sure it is in writing. If the company won't put its promises in writing, look for another company which will.
• Do not sign the contract until you read it carefully. If the salesperson pressures you to sign before you read and understand the entire contract – don't sign it. Never rely on the salesperson to read or explain the contract to you.
• Do not pay for work in advance.
• Inspect all of the work very carefully to make sure it was done properly. If you have any doubts or questions, do not make your final payment or sign a "completion certificate" until the work is properly finished.

It is also always a good idea for consumers to document the damage that existed before repairs and the work that was done to correct the damage. A good way to do this is by taking date stamped “before” and “after” photos.