Try Premium for

Search
Home My Network Jobs Messaging Notifications Me For Business $0

HELP!!! My contractor took my

money and ran!!!
Vince Thompson 15 articles Follow
Sales & Management |

August 21, 2023

Open Immersive Reader

Help!! My Contractor Disappeared!!

The nightmare has become reality.

You’ve hired a contractor for your remodel project, paid them a deposit and
they’ve even started work. But now it’s been a few days, a week or even longer
with no updates or communication from the contractor.

What do you do!?!?

1. Review your contract.

I frequently say “If it isn’t in the contract, it doesn’t exist”.

What does your contract say, if anything, about timetables?

2. Think back and remember

Think back to the last communication you had with the contractor. Did they
mention that there may be a bit of time before they were on site again? There
are many reasons that a contractor may not show up for a few days or
longer. YES they should clearly communicate these delays! But maybe they
haven’t or failed to let you know about this delay.

3. Stay Calm and Contact Them Several Times

While it’s easy to be frustrated when your contractor doesn’t show, consider
first that it may be a miscommunication. Most contractors are hardworking,
trustworthy professionals, though there are a few bad eggs in every profession
who lack integrity. Rather than assuming that your contractor is stealing from
you, it’s possible there’s been an illness, death in the family, or other
delay. They may be a great contractor but a terrible communicator.

Contact your contractor by phone or email with respect and compassion.

Reach out three times and consider dropping in to their place of business or
contacting a representative at their company.

Document all attempts to contact them, as these records can come in handy
later if you end up needing to pursue legal action.

4. Send a Registered Letter (or Two)

If indeed your contractor has ripped you off, you can send a formal letter or
have your attorney help you write one. You’ve made those three phone calls,
documented them and reviewed your contract. A signed, registered letter is
often enough to get a contractor to finish the job or return your deposit.

In your letter, detail your expectation for them to perform the terms of your
written contract (hopefully you have one). You can mention that if you don't
hear from them or get your deposit back, you'll contact their licensing board,
the Better Business Bureau, the district attorney's office, or their bond
company.

Send your letter as a registered letter through the postal service so you have
proof of sending it. Registered mail also offers verification that the letter was
delivered or that delivery was attempted. Having proof of a sent letter is
beneficial if you decide to pursue arbitration or a small claims court case later
on.

Detail out next actions you plan to take if you don't hear from them within a
certain timeframe, such as 10 or 14 days.

5. Contact Agencies That Can Help

Several state and local agencies can help you with a disappearing contractor
who’s gone off with your deposit without doing any work. Depending on your
state and the type of local contractor you used, some agencies may be more
helpful than others. They can help you take action against a bad
contractor by offering legal support or putting the contractor’s business or
license in jeopardy. Contact one or several of these top agencies to see who
can help you best.

Better Business Bureau (BBB): You can file a complaint with the BBB,
which might entice the contractor to finish the job or at least give your
money back. The BBB also provides mediation and arbitration services
from informal to conditionally binding. You may be able to settle the issue
through the BBB without going to court. These days, the Better Business
Bureau is not what it once was. Most consumers don’t turn to the BBB to
find reports on businesses they may be planning to hire so the negative hit
on a business by having a less than positive review or record from the BBB
isn’t as damaging as it once was.

Department of Consumer Affairs: Consider filing a complaint with your

state’s consumer protection division and ask them for help with your case.

Local District Attorney's Office: Contact your local district attorney’s

office and ask them how to file a fraud complaint or formal police report.
Follow their recommendations of what steps to take first, such as filing an
official complaint before going to the police.

State Attorney General's Office Consumer Fraud division: Your state

attorney’s office can help you file a complaint or support you in the legal
process.

Consumer Protection Agency: Report fraud from a contractor and ask

for assistance or legal support.

Home Builders Association: The National Homebuilders Association or

your state’s home builder’s association might assist you and offer you
resources when a contractor suddenly disappears. Another similar group
is NARI - The National Association of the Remodeling Industry. They have
many consumer oriented programs to help homeowners in the remodel
process.

Your Bank or Credit Union: If you paid the contractor deposit by check,
contact your bank to see if they can put a fraud alert on the contractor’s
account. The contractor’s bank may be able to freeze the funds in their
account.

State Licensing Board: This is one of the big hits that a contractor will
take seriously! All the hoops a contractor has to jump through to become
licensed and all the expense it takes to maintain a license will cause most
contractors to take this step quite seriously. As such this step should be
reserved for serious offenses only. Your State licensing board also has
access to the contractors insurance policy and bond. The licensing board
that issues and maintains contractor licenses may be able to help you
report fraudulent activity, and the board may cancel the contractor's
license.

Local Police: Before going to the police, protect yourself by talking with your
local district attorney’s office or a lawyer about recommended steps.
Sometimes but not always, going to the police about fraud or theft can help.

Local News and Consumer Reporters: Some local news stations,

journalists, and radio stations cover stories about contractors who
disappear. They may investigate the issue, expose the fraud, and notify
the community. Your contractor may reach back out to you to help clear
their name and reputation.

5. Make a Claim Against Their Bond

Bond companies protect homeowners financially in cases of fraud and

damage. If you hired a licensed and bonded contractor, you can file a
complaint with the licensing board against their bond. But you need to provide
proof, which is why your written contract, payment history, and records of
contacting the contractor are essential.

Before filing a claim against their bond, you’ll usually need to inform your
contractor that you plan to do so. The threat alone might be enough to
convince the contractor to finish the job or give you your money back.

6. Request Arbitration

Arbitration is a low-cost process where a neutral or third party mediates a

resolution between you and the contractor. These out-of-court hearings are a
great way to come to a final agreement without stepping into court. Ask an
attorney about how to approach arbitration and what they recommend for your
case. I’ve heard that arbitration is successful when both parties leave with
neither one 100% satisfied with the result!

7. File a Small Claims Court Suit

If your claim is minor, you can file a suit through small claims court. Each state
has a limit, some at $3,000, $8,000, or up to $25,000. You can file a small
claims case yourself or have an attorney help you.

Typically homeowners consider small claims court after they've tried

arbitration, as there are fees to file a suit. Some contracts even dictate that you
must pursue arbitration before taking legal action.

8. Hire an Attorney

If you cannot resolve the issue through other routes, you may wish to hire an
attorney. While expensive, it could be worth it if your claim is large enough.
Consider contacting a contract attorney and asking them if your claim is
substantial enough and has merit. The rate for contract attorneys can be up
to $120 per hour.

9. Leave a Review

Beyond resolving your case, it's important to help other homeowners avoid the
same challenges. Post an honest, helpful review about your experience with
the contractor on websites and online forums. Reviews—good and bad—help
homeowners make smart hiring decisions and dodge financial loss. These
days, google reviews almost reign supreme and along with Yelp, Facebook,
neighborhood Facebook groups or pages and the neighborhood based social
media platform “Nextdoor” are all places to turn to find reputable contractors
as well as leave a review as a warning to others.

**As a contractor, I do ask that you exhaust all steps before turning to law
enforcement, state licensing office and social media. It takes a business over
30 five star reviews to offset a single 1 star review. Of course if you’ve
exhausted all reasonable efforts and the contractor refuses to contact you of
reasonably resolve your issue then you have every right to leave a review.

I remember a client who was upset that there were rocks in her back yard after
we built an addition. She had elected not to pay for new topsoil to be hauled in
to re-grade her yard so we simply used the existing soil. As you might expect,
most soil in East Tennessee is not rock free! In an effort to satisfy this client we
hand picked several 5 gallon buckets worth of rocks from her backyard before
seeding and spreading straw to the area. She was still unsatisfied and filed a
claim with the state licensing board as well as left us a 1 star review! The state
licensing board of course acknowledged that she had no claim and found us
innocent of all the charges she brought but the 1 star review remains.

In closing. Protect yourself on the front end throughout the

process. Remember that most issues can be handled by clearly
communicating and remembering that we’re all human beings. But if it’s clear
that your contractor is intentionally ripping you off then use the resources at
your disposal to protect yourself and recover your investment.

Report this

Published by

Vince Thompson
Sales & Management | 15 articles Follow
Published • 6mo

#generalcontractor #ripoff #remodeling #legal #renovation #knoxville

Like Comment Share 2

Reactions

0 Comments

Add a comment…

Vince Thompson
Sales & Management |

Follow

More from Vince Thompson

The Challenge of You got 3 estimates……

searching for “Fair and Now what?
Reasonable" Prices
{:member} on LinkedIn
{:member} on LinkedIn

The Benefits of a General

Contractor That Utilizes
Subcontractors:…
{:member} on LinkedIn

See all 15 articles

Like Comment Share 2 Messaging