Headache-free Home Improvement

Sept. 29, 2007 — -- Everyone's heard the nightmare stories about dealing with home improvement contractors or, even worse, lived through that nightmare themselves. Roger and Angie Vega of Queens, N.Y., are in the middle of such a nightmare right now.

Earlier this year, they hired contractor Alex Jader to remodel their dream house, the very first home they'd purchased together. The Vegas wanted to update the kitchen, add a bathroom, build a new deck and fix the roof. They said they paid Jader thousands of dollars in cash because they thought he'd work faster and more efficiently as a result. At first, Roger said, he did.

Jader fixed the roof right away but then never finished it with gutters. Soon rainwater started to cascade off the roof and work its way into their basement. Then, Roger said Jader's work got worse.

"He was here every day. Then little by little, he started to come four days a week, then three days, two — and then finally he just didn't show up at all."

When Jader disappeared, the Vegas were left with a disaster. Their home had become an open construction site without kitchen cabinets or working appliances. Their bathroom was full of holes and cracks, exposed wires and leaky pipes. The couple said they felt devastated "because we treated him like family. He sat here with us, and he ate, and he said, 'I'm here to make friends, and not enemies.' We believed him."

With their house left in chaos, the stressful situation caused tension between Roger and Angie, and they started to fight with each other over their plight.

According to contractor Mike Holmes, the Vegas' problems are sadly typical. On his hit Canadian series "Holmes on Homes," his team routinely swoops in and fixes up botched work left behind by unreliable contractors. He's heard more than his share of homeowner tales of woe.

"Is there some sort of savior system that you can call? '1-800-helpme, I'm screwed by a contractor?' No there's not," Holmes said.

As a result, the burden is on the homeowner to pick the right company beforehand. That's not an easy task, however, because Holmes said even in the best-case scenario, just two out of every 10 contractors know what they're doing. He believes 70 percent of them are bad.

"Why are they bad? Well, they're not thieves," he said. "But they don't know enough, and they don't care enough. Either way, you're in trouble." Holmes estimated that as many as 10 percent are outright crooks.

"20/20" asked Holmes to tour the Vegas' house to check out the quality of the work left behind. He wasn't impressed, pointing out cracking grout in the new kitchen floor, potentially dangerous wiring in the bathroom, pipes installed incorrectly and countless other examples of shoddy construction. Holmes said little if any of the renovation was done right. Much of the work was never completed at all, including a backyard deck that was demolished and never rebuilt.

The bottom line? Holmes said "They probably still have $40,000 worth of work here." As for the $37,000 the Vegas said they already paid Alex Jader, Holmes said "that money's wasted. That money's out the window."

Do a Background Check

Holmes is troubled that the Vegas, like so many unsuspecting homeowners, never checked Jader's license or references. He recommends asking potential contractors for 20 references, and calling every one. Since Jader had been referred by a Web site called ReliableRemodeler.com, Roger and Angie thought he'd be, well, reliable. Once their contractor disappeared, they called ReliableRemodeler.com to complain. Roger said he was told the company wasn't liable for problems because the Web site simply refers contractors to homeowners. It doesn't actually recommend contractors.

When "20/20" contacted the Web site and asked if it did any sort of background check, the company said it does ask contractors for a copy of their license. When asked to see that -- or any other background information it may have gathered on Jader -- the company said it threw the license out and couldn't show us any other information.

"20/20" decided to do an independent background check but couldn't find any record of a license in Jader's name. The search did reveal, however, that Jader's real name is Alex Ojeda, and that he had pleaded guilty to attempted unlicensed contracting in nearby Nassau County, where he was forced to pay back more than $20,000 to two other homeowners he had wronged.

ReliableRemodeling.com makes money by charging contractors a fee for customer leads. When the company was asked why it would refer someone like Ojeda, it had no further comment.

Get Everything in Writing

As for Roger and Angie Vegas, once they hired their contractor, Holmes said they missed another crucial step: a detailed contract. "Get everything in writing." Holmes said. "Everything. What type of wood they're using, what type of paint, what type of finish, what type of cabinets, flooring, etcetera. How much is it going to cost, how much are you going to pay in milestones."

Those milestones spread out the payments, he said, and keep the contractor coming back until the job is done. And don't fall for extra charges that go beyond the estimate, unless you've asked for more work to be done.

Be Diplomatic

Other red flags, according to Holmes, are contractors who aren't keeping to a preset schedule. He said they'll call up with sob stories like "'I'm sorry I'm late, you know, my cousin got stuck and I had to go help him out.' And then next week there's another story about his wife or his child or his neighbor." The Vegas said they heard those hard luck stories from Ojeda, but didn't know what to do.

If you spot problems or don't feel the work is going right, Holmes warned it's best not to angrily confront the contractor. Instead, he suggested a more diplomatic approach, such as "speaking up right away and saying 'is that right? How are you going to do that?'"

In other words, turn your concern into a question rather than saying, "I don't think that's right."

Know When to Cut Your Losses

The only time to confront your contractor is if the red flags start piling up and the work isn't getting done right. Don't keep hoping things will get better, Holmes said.

Instead, he advised cutting your losses and getting out now. "It's only going to get worse. Trust me," Holmes said.

The best way to fire your contractor is to be blunt, he said. Just tell them, "Pack your stuff, get the hell outta my house. Now!"

It's all advice that comes too late for Roger and Angie Vegas. They said they've used up all their money and can't even afford a lawyer to sue Ojeda. Even if they could, it would be a tough road.

According to Anne Goldweber, director of the Elder Law Clinic at New York's St. Johns University, a contractor's assets can be hard to track down.

"Once the contractor has taken off with your money — and maybe done very faulty work and left the job half done, it may be too late to try to get you made whole," she said.

In one recent case against a different contractor, Goldweber said, "We won a $125,000 judgment from the court, and we never collected one penny."

Alex Ojeda might be tough to collect from as well. The Nassau County, N.Y., district attorney recently charged him with a criminal probation violation after he stopped making payments to those two other homeowners in the attempted unlicensed contracting case. When "20/20" tracked him down on his way out of the courthouse, Ojeda promised to take care of the Vegas' home and denied walking off the job. Then he ran away down the street.

Advice for Home Renovators

You can usually confirm a contractor's license online, but every state has different regulations. Check your state's attorney general's Web site for more information.

Most towns and cities require permits for any renovation work. Remember, this protects you because an inspector has to approve key items like plumbing, electrical and structural work to make sure it's safe.

For more contractor hiring tips from Mike Holmes, click here.