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How to Avoid Contractor Scams

The contractor you choose to build your home will have a major impact on your project's success. Good contractors work hard to complete home improvement projects according to their client's budget and the proposed timeline. These contractors produce quality work and have pride of workmanship.

Unfortunately, not all contractors have ethical business practices. Contractor scams from unlicensed, illegitimate businesses can cost homeowners hundreds or thousands of dollars in damages and repairs. For more information about how to complete a successful construction project, download our free Custom Home Guide Book. For more information about avoiding contractor scams, read on.


View the Portfolio

Reputable contractors keep a record of their previous work, so clients can view that work for themselves. Most contractors post their portfolio online, but you may also encounter contractors who keep a paper portfolio, or who prefer to send photos by email.

Viewing the portfolio will give you a sense of the contractor’s style and abilities. The portfolio should reflect superior quality and attention to detail. Look for photographs of previous work similar to the type of project that you wish to complete at your home. Be wary of a contractor who has no portfolio or pictures of related work.


Get References and Referrals

Before starting a home improvement project, talk to trusted friends and relatives who embarked on similar projects, Would they refer that contractor, or hire that builder again?

Before hiring a contractor, get (and check) references. Ask all references the same questions, to make comparison easier. Ask questions such as:

  • What did you hire this contractor to do?
  • Would you hire this contractor again?
  • How did the contractor communicate changes with you?
  • Did the job start and finish on time?
  • Did the contractor work within your budget?

Ask these questions to get a sense of the typical experience with this contractor. Ideally, some references will have hired the contractor to do the same work that you’re hoping to have done. If all work was unrelated to your job, ask the contractor for additional references.

Download Questions to Ask Your Builder [Free PDF] 

Get a Contract

Contracts protect consumers. Even for small jobs, ask for a contract to establish expectations and avoid surprises. Look for the following information on the contract:

  • Contractor name, contact information
  • Jobsite address
  • Your name and address
  • Scope of work
  • Itemized list of materials, allowances and related expenses, and all their costs
  • Payment terms, including payment schedule


Check Licensure, Bond, and Insurance

Good businesses will have consumer protections in place to ensure a good experience for their customers. Ask contractors if they are bonded, licensed and insured.


Licensure means that the contractor has met state or local requirements to build and repair structures in the state of New Jersey.


An active insurance policy will protect your interests in the event that the contractor does damage to your property while on the job.


The bond is similar to an insurance policy, but will pay if the contractor does not resolve issues relating to poor workmanship.


Know What to Avoid

Be wary of contractors who solicit door-to-door and pressure you to make a decision on the spot. Though some reputable contractors do use door-to-door advertising, they should allow you time to gather information and make an informed decision.

Watch out for contractors who ask for the bulk of the money before the work has been done. Most contractors will ask for some money up front to pay for materials, but often only a percentage of the total bill.

Avoid contractors who dramatically undercut their competition. These contractors could be using inexperienced labor, lower quality materials, or may be planning to change the price midway through the job. Either way, this could lead to problems while the work is taking place or after the work is finished.


Contact a Reputable Contractor

The majority of contractors are ethical professionals who want to do the job right. However, some contractors are not. Either because of poor business practices, inexperience or a disregard for the needs of clients, some contractors do more harm than good.

If you’re ready to get started on your home improvement project, contact a reputable contractor. GTG Builders LLC is a family-run business with over 65 years experience. We value our clients and take pride in our work. Contact us today to make an appointment for a free consultation, or download our free resources online to learn more about starting your home improvement project.


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