Five Red Flags that Mean a Contractor is a Rip-Off

It's always hard to decide on the contractor you're going to hire for a project. Even though the majority of them are probably respectable businessmen, there are still plenty of swindlers out there just waiting to get their hands on your money. The best way to protect yourself is to watch for five red flags that mean a contractor is a rip-off. As soon as you spot even one of them, it's time to part company with that contractor.

1. A Contractor Gives You A Bid Far Below the Rest
Anytime you receive a bid from a contractor that's way below the others you've received, that's a red flag indicating something's wrong. Tom* and Ella* wanted a simple two-car garage built. They only had a certain amount of money to invest in the project, so the quotes had to stay within their tight budget.

Tom* and Ella* met with five contractors. They showed them the building plan they had in mind. All the estimates they got were in the $20,000 range- except one. It was only $15,000. Being that Tom and Ellas' budget was so tight, they sat down with the contractor who gave the lowest bid. Everything seemed to be in order so they hired him to build the garage. The contractor did indeed build it according to their plan. However, he used the cheapest, lowest grade of wood and other materials he could get his hands on. Tom and Ella got a low-cost garage built, but how long it will stand is questionable.

Contractors who severely underbid projects also try to make up the loss by adding on "unexpected" costs throughout the project.

And, true scam artists who are posing as contractors give you a rock-bottom bid so you'll give them the job. They'll then take your money and run.

2. A Contractor Has No Provable Physical Business Address
One of the first things you should do when you receive a written quote from a contractor is to check for his/her contact information. There's undoubtedly a phone number listed, but is there a physical address? (A post office box doesn't count.) Fly-by-night scammers who are on the run don't have addresses because they don't stay in one place for long. Any respectable contractor is going to have a fixed place of business, even if it's run out of their home.