Creative Consumer: Beware of These Home Renovations

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Spring starts this week, and that means flowers are coming out -- and so are unlicensed contractors. I've warned folks about unlicensed contractors countless times, but the Montgomery County, Md., Office of Consumer Protection says there's a whole new reason to beware.

"An increasing number of unlicensed home improvement contractors also have criminal histories," Director Eric Friedman said. "It can be potentially dangerous to hire unlicensed contractors."

Montgomery County has obtained an arrest warrant for an unlicensed contractor named Cesar Suazo Rivera, for instance. The warrant charges him with abandoning jobs and felony theft. Investigators say Rivera received a check for $82,500 to start a home improvement job, then never showed up to do the work.

Scarier still, Rivera is also wanted in neighboring Virginia for attempted abduction and malicious wounding, incidents that occurred while he was allegedly practicing his profession without a license.

Click Here to Ask Elisabeth Your Consumer Questions

Here's the flip side. Did you know you could be arrested for using an unlicensed contractor? It's possible. In states that require licensing, hiring an unlicensed contractor is illegal.

Did you know an unlicensed contractor who gets hurt on your property could sue you -- and win? Unlicensed contractors are unlikely to carry proper insurance, so it has happened. These are the extremes. But even the typical experience with an unlicensed contractor can be devastating.

Elease W. saved for two years to build a ground floor bathroom in her home because she has arthritis and stairs are hard for her. She paid a contractor $10,000 to do the work. Two years later it still hasn't been done right. For months, Elease and her daughters felt like prisoners in their home. The contractor left gaping holes in the walls, so they didn't dare leave. The water pipes were built outside the structure where they froze in the winter. The foundation was unstable and the siding immediately started peeling off. Of course the family didn't check out the contractor until after everything went wrong. It turned out he was unlicensed and had a complaint record a mile long.

Paul H. needed a new roof. He got a couple of different estimates, but felt he couldn't afford them. Then he spotted an ad in one of those free neighborhood newspapers. The ad promised the lowest roofing rates in town.

Paul hired the man to reroof his home for $5,000. The man demanded full payment in advance. The man climbed around on Paul's roof for a few minutes, then said he was going to get supplies. He never returned. When I investigated, I learned the phone number in the ad actually belonged to an answering service. The address the man gave Paul didn't even exist. And there were no licensed contractors by that name listed with the state.

Licenses are generally required for any work that affects the structural or electrical integrity of the building. I've done a couple of different undercover investigations in which we invited unlicensed contractors to give us estimates for roofing work.

First, it was easy to find unlicensed contractors. We spotted their ads in local newspapers and found their business cards at home improvement stores. Unlicensed contractors tend to use the cheapest possible means to market themselves.

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