Fraudulent Consumers Are In Every City and Town
Fraudulent consumers and homeowners take advantage of businesses each and every day. They target builders and remodelers because the average building or remodeling job can run in the thousands and tens of thousands of dollars.
The swindling homeowners can keep tons of money in their accounts and pockets because they have no morals.
I was a victim of an evil woman several decades ago who cost me approximately $60,000 in the early 1990s. I still simmer each time I think of how crafty and cunning she was.
Cheating Builders Too
There are plenty of dishonest builders and remodelers out there too. I've written extensively about them in previous columns.
It's important to realize this article is dedicated to all the double-dealing homeowners and fraudulent consumers who get great delight from not paying deserving contractors for satisfactory work performed on time and within budget.
Possible Reasons for Dishonorable Conduct
There are any number of reasons why fraudulent consumers would want to cheat a builder or remodeler. A point often overlooked is simple greed. I'm not a psychologist, but my guess is a greedy person desires to keep as much money as they can.
Another key point is selfishness. Selfishness is the root of all evil.
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Advance Payments to Contractors
A homeowner that withholds a final payment to a builder or remodeler for unjust reasons is only thinking of themselves. The homeowner doesn't care about the contractor's sub-contractors who have bills to pay, the contractor's own obligations and most certainly the contractor's peace of mind.
Construction started on this house three years ago. It's possible the builder was dealing with a fraudulent consumer and pulled the plug early. A month ago the walls and roof finally went up. (C) Copyright 2017 Tim Carter
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Source of Misunderstandings
Some homeowners are indeed evil and premeditate their plan to not pay the contractor. I've served as an expert witness for over fifteen years in homeowner/contractor disputes and have come to realize that most non-payment issues on the part of a homeowner stem from any number of misunderstandings.
The misunderstandings can be eliminated to a large degree with excellent plans and written specifications. It would be great if homeowners produced these, but most have no clue what to even specify.
If you're a builder and want to get paid, then the onus is on you to go to great lengths in the contract documents to explain exactly what you intend to do and what materials you intend to use.
Face-to-Face Meeting
Prior to signing the contract, it's a great idea for you to meet face-to-face with the homeowner and go over in painstaking detail all the fine points of what's going to happen.
Modern technology allows you to create electronic documents overflowing with color photos of construction details that might become points of disagreement months from now.
Eliminate Allowances and Change Orders
Allowances are hidden time bombs. Eliminate them in the bidding phase by requiring the homeowner to make the needed selections so they stay within budget. If a homeowner goes over budget on an allowance item, how are you to know if they have the money to pay for it four months into the job?
Change orders almost always add cost to the job. Eliminate them using technology to transform two-dimensional plans into 3D renditions so homeowners can see what is really going to happen.
Given these points it's still up to you the builder and remodeler to look for signs and past history that might telegraph you're about to sign up a miscreant homeowner.
There's a good chance the homeowner asked you for references before they chose you. It's your turn to be selective. Run a credit report on them. Do fast internet searches to see if some other business complained about them.
Demand bank statements. Be sure the homeowner has plenty of cash to pay you.
If the homeowner is getting a loan, get a copy of a pre-approved loan and contact the lending institution to ensure the homeowner has closed on that loan. Don't assume the pre-approval letter means the homeowner has the money!
Be bold. Be brave. Don't worry about losing a job by asking probing questions. There are plenty of other honest homeowners looking to hire you! You can only blame yourself if you get tangled up in the vile webs of a fraudulent consumers!
CLICK HERE to get FREE & FAST BIDS from local contractors who have families to feed.
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