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Homeowners Beware – 10 Biggest Contractor Scams

From creating cozy living spaces to increasing home value, enhancing your living environment often involves hiring professional contractors. As critical as these professionals are to building your dream home, the advent of fraudulent activities in this sector has reached concerning levels. 

In this blog, we focus on the brazen realities of contractor scams, with a special emphasis on the challenges associated with hiring painting contractors in Toronto. With a rise in unscrupulous activities, from skyrocketing quotes to cutting corners with substandard materials, these scams have left many a homeowner distraught and financially strained.

But worry not, as we unveil the biggest contractor scams you need to be cautious of in 2024, along with practical advice on how to protect your pocketbook and your peace of mind when embarking on a home painting project.

Biggest Painting Contractor Scams

Every year, homeowners fall victim to contractor home improvement scams. While most homeowners are aware of these common issues, there are still plenty of people who fall victim to them. The worst part is that they’re almost always preventable if you are aware of these scams and take the right steps to protect yourself.

Here are some of the biggest contractor scams in 2024 that you should be aware of. We will also share some tips on how to spot scammers as well as how to avoid contractor scams.

Scam #1: The Fake Expert Scam

The first common contractor scam is where the scammer poses as an expert or an inspector and inspects your house without telling you. They then come back with a fake report that says there are major issues with the structure of your house. And then they tell you that they need to fix it immediately.

In November 2022, CityNews reported that a family in Toronto paid a $1,000 deposit for work on their chimney that the family said they didn’t need. They said that scammers went to their house when their mother was home alone and claimed that the chimney was not up to code.

The suspects threatened to file a complaint with the city if their mother did not hire them to fix it. So she gave them the deposit but claims that the work was never completed.

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One Day Deal

Scam #2: Big Deposit Scam

In Winnipeg, a man responded to an online ad and gave a large deposit for painting work on his home. He claims that the company never returned his calls or showed up at his house. He later learned that the bad contractor’s website was just a scam and the ‘company’ didn’t do any work.

Scammers create fake profiles and use stolen photos to fool victims into thinking it is them. In November 2022, a company that has been accused of taking advantage of homeowners in Toronto is also said to have stolen photos from legal contractors in the GTA. CityNews said that M.B. Roofing and Masonry had a fake website, fake reviews, and pictures that didn’t belong to them in their photo gallery. The police said that the “company” took large deposits but did not finish the job.

Scam #3: Door-to-Door Contractor Scam

Halton Regional Police Service says that people posing as contractors go door-to-door selling services. They are said to give quotes that are lower than the market value. And once a deal is made, they ask for a large cash payment.

The work may begin, but it will be of poor quality and/or incomplete. After the first part of the job is done, the suspects are said to ask the homeowners for more money to pay for supplies or to finish paying for the job. The contractor vanishes after obtaining the additional funds.

As of August 2022, there have been two reports of this tactic being used. And the police think there may be more victims in Halton and other places. 

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Scam #4: Lowball Price Scam

The suspects typically call the victims and ask to meet in person or by phone. Then, they’ll give you an estimate of how much the job will cost, which is often a lot less than what other contractors have said. The suspects may say that this is a special offer for new customers or that it’s a “one-time deal.” Or something like, “If you don’t take advantage of this low price today, it won’t be offered again.”

In August 2022, Peel Regional Police said that a man had been arrested for what they said was contractor fraud in several cities in the Greater Toronto Area. They said the fraud happened over two years, from 2020 to 2022, and is thought to be worth more than $1 million. According to police, the suspect promised contractor home services, received deposits, and used subcontractors. Several of the victims have come forward to say that services never even started.

Top 5 Tips for Spotting a Con:

Now that you are aware of the biggest contractor scams in 2024, you might ask: How do you tell if someone is scamming me?

The answer is that there are many tell-tale signs to look out for. Here are the five most common:

  • Tip #1: If it sounds too good to be true, it probably is. Don’t let anyone tell you otherwise. Trust your gut feeling and better to be safe than sorry. 
 
  • Tip #2: “Free” or “discounted” estimates aren’t always what they seem. In fact, many contractors will use them as an excuse not to honour their quotes. If something goes wrong during work or after completion.
 
  • Tip #3: If someone is pressuring you into signing up right away. Or sign an agreement without fully understanding what’s included (or what isn’t), be careful! That person might be trying to trick you into agreeing to terms that aren’t favourable for you in the long run.  Take your time and only sign up when you feel comfortable with the contract and terms. 
Warning Sign
  • Tip #4: If a contractor asks for an unusually high deposit (anything over 25%), or demands payment before work has been completed. Find someone else who will give you more assurance. And certainty they are a credible and trustworthy contractor. 
 
  • Tip #5: If the contractor won’t provide written estimates or invoices, that should be a red flag. They may be trying to hide something from you.


How to Protect Yourself from Painting Contractor Scams

To avoid falling victim to these scams, it’s essential to:

• Always check references and read reviews before hiring a contractor.

• Verify the contractor’s insurance and licensing status.

• Be sure all terms, including the nature and scope of work, materials used, and payment schedule, are clearly specified in a written contract.

• Never pay the full amount upfront—find a payment schedule that works for both parties.


Key Takeaways: Staying Alert While Dealing with Painting Contractors

Staying alert while dealing with contractors is key to preventing scams:

No Full Upfront Payment: It’s a red flag if the contractor demands the full amount before starting the job. A payment schedule tied to project milestones is ideal.

Quality Materials: Ensure that the materials align with what’s agreed upon in the contract, and don’t hesitate to question unfamiliar brands or cheap alternatives.

Permits and Paperwork: Verify that all necessary permits are obtained, and don’t agree to skip this important step to save some dollars.


What To Do When Scammed by a Contractor

If you’ve been scammed by a contractor and it’s too late to get your money back, take action.

  • Report the scam to the Better Business Bureau.
  • File a complaint with local law enforcement agencies.
  • You can also file a complaint with the Federal Trade Commission. The FTC provides a tool for reporting scams and includes information about what to do if you’ve been scammed by a contractor.
  • Check with your attorney general office for more information on how to protect yourself from future scams. 
  • Report their wrongdoings on a Facebook local renovation or home improvement group and ask for advice.

The Spillover Effects of Painting Contractor Scams

Painting contractor scams not only strip homeowners of their hard-earned money but also result in a cascade of negative impacts:

  • Wasted Time: Unfinished projects, redoing subpar work, or sourcing new contractors require a significant time investment.
  • Mental Stress: Contractor scams can cause emotional distress as homeowners grapple with unfinished projects, financial losses, and unforeseen legalities.
  • Property Value: Poor quality work or incomplete projects can negatively impact the property’s value.
Painters Painting And Prepping.

 

When dealing with any type of contractor, you must be as informed as possible. Homeowners can’t be too aware of the possibility of being scammed by a contractor. You could be facing a big financial loss and damage to your home, so always ensure you get references before the work begins. Do everything you can to verify their identity and learn about their reputation for dependability. Avoid websites that are full of scammers, such as Kijiji or Craigslist. Use contractor review websites such as HomeStars to read reviews on potential contractors.

For further insights to ensure a successful experience when hiring a painting contractor, we invite you to explore our other informative blogs, such as The 7 Biggest Homeowner Mistakes When Hiring A Painting Contractor and 10 Questions You Must Ask When Hiring A Painting Contractor. By continually learning and staying informed about industry best practices, you can confidently hire a trustworthy and skilled painting contractor in Toronto who will deliver the exceptional results your home deserves.

You may also find this blog post helpful: Tips for Hiring a Toronto House Painter

 

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Since you are seeking a painter, why don’t you give us a shot? We’ve been doing renovations for over 36 years, so you can rest assured that you’ll be happy with the results. We offer free estimates on home renovation and painting projects, so contact us today at (416).494.9095 or Brian@HomePaintersToronto.com to get started. You can also find all of our social media links down below.