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Use Caution When Hiring Contractors For Disaster Repairs

Release date: 
June 26, 2002
Release Number: 
1420-06

Cedar Rapids, Iowa -- State and federal disaster recovery officials are advising Iowa residents who have disaster-related damage to be extremely careful when hiring contractors to clean and repair their homes and businesses.

"In disaster situations, scam artists are often ready to take advantage of the misfortunes of others," warns Steve Zimmerman, state coordinating officer, Iowa Emergency Management Division.

"The recovery process can be a positive one if you take your time, talk to building and floodplain officials, and select a contractor with great care," added FEMA Federal Coordinating Officer Pete Martinasco. FEMA does not in any way endorse, certify or approve building contractors.

The Iowa Attorney General's Office and the Better Business Bureau offer the following "Consumer Beware" suggestions:

  • USE RELIABLE LICENSED CONTRACTORS AND HIRE LOCAL CONTRACTORS IF POSSIBLE: Check with the Iowa Better Business Bureau and local business organizations for outstanding complaints against a contractor. Check references and call the Labor Services Division of Iowa Workforce Development 800-562-4692 - ext. 25871 or 515-242-5871 to see if a contractor is properly registered.

  • GET A WRITTEN ESTIMATE: Read the fine print and compare several competing services and prices before settling on one contractor.

  • ASK FOR A WRITTEN CONTRACT AND GUARANTEE: NEVER SIGN A BLANK CONTRACT. Identify all tasks to be performed in great detail, all associated costs, payment schedule, and who applies for necessary permits and licenses. Have a lawyer review the contract if substantial cost is involved. Keep a copy of the signed contract. The guarantee should state what is guaranteed, who is responsible and how long the guarantee is valid.

  • GET PROOF OF INSURANCE: Make sure your contractor carries general liability and workers' compensation insurance.

  • PAY BY CHECK: Avoid on-the-spot cash payments. It is best to write a check to the company. Thirty percent of the total cost is a reasonable down payment. If a contractor insists on an advance payment for materials, make the check out to the supplier, or to both the supplier and the contractor.

  • HAVE WORK INSPECTED: This is especially true for sewers or basement walls before they are hidden from view.

  • DON'T MAKE FINAL PAYMENT UNTIL THE WORK IS DONE TO YOUR SATISFACTION. Be sure to obtain lien waivers to ensure that no one who supplied materials can put a lien on your home because the contractor did not pay them.

  • BE ALERT: If you are offered a price that is far less than other bids received, it may be too good to be true.

  • IF NECESSARY, CANCEL A CONTRACT WITHIN THREE BUSINESS DAYS OF SIGNING, being sure to follow contract cancellation clauses. In Iowa, the consumer has three business days t...
Last Updated: 
January 3, 2018 - 12:56