Scam Alert: Reader submitted- Contractors who ask to be paid BEFORE work is done

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A reader sent this to us – in order to prevent people from falling prey to the same scam.


I recently hired a contractor to do work in my house. It was a relatively small job, and he charged me $6,000. We had a contract, he had an LLC and everything looked perfect.

The payment terms were as follows: 1/3 up front, 1/3 in the middle of the work, and the last 1/3 upon completion.

The cost for materials and workers was about $3000 and the job was projected to take 4 days.

Day one, he showed up with the contract. I reviewed it and paid the first 1/3 ($2000). They worked for 2-3 hours that day.

Day two, they showed up and put in a whole day’s work, the cost for equipment was under $100 as that day was basically prep work. At the end of the day, the contractor said we just need an additional day or two since all the prep work is done… And he requested the second 1/3 ($2000). I was concerned about paying since I knew his expenses would come at the end… But I had a contract, so I paid.

The issue is: There never was a day three and four! Once he got the second 1/3, he was off to the races!

The final third would have been for the expenses – there was no profit in it – so after he got his money – he did not return.

When I called him, he said I got a great deal and the project was underpriced and that he cannot complete the job at such a low price since he used up all the money already ‘on other things’. To finish, I would need to pay the labor cost for his crew. I told him we have a contract to which he replied he feels bad but he used the money and just can’t finish the job. He said I can sue him but there is nothing he can do!

The good thing is: I contacted the Police who came to the work site and said it is contractor fraud a 4th degree offense which is an indictable crime and can potentially receive jail time. The police said “Your contractor has a strong motivator: Finish the job or go to Jail”.

B’H the contractor finished up the job – quickly – after being informed that the Police were involved and can potentially lock him up.

Please, protect yourself. Never pay up front for a job that had expenses at the end!

GreaterLakewood compiled a few tips to prevent this from happening to you:

  1. Ask people you trust. Use your friends, family, co-workers and neighbors to help you find a reliable contractor. Ideally, they’ll recommend someone who has already completed work for them.
  2. Keep it local. If you work with a local business, you can be sure they have a location, phone number and contact person nearby in case something should happen during the project.
  3. Ask for references. Inquire about recently completed projects and ask to visit one of their worksites.
  4. Know your contractor’s schedule. Questions to ask a contractor include: How much time will be spent on your project? When will it be completed?
  5. Get written copies. Request the cost of work and the cost of materials as well as the project timeline in writing. Get copies of receipts, too.
  6. Remember a small job generally gets paid at the end and down-payments are not necessary, because the contractor has the ability to lay out the money himself, due to the low cost of the materials. A larger job, however, should have a payment schedule that matches the contractors needs to purchase material…

S. B.

6 COMMENTS

    • The poster didn’t make it that everyone is a scammer, rather anyone can be a scammer. Do your due diligence.
      It’s like warning people someone is a murderer
      , it doesn’t mean everyone is….strange you took it that way….unless….. 🙂

  1. Those problems go both ways

    Scam Alert: Reader submitted- homeowners who ask to pay AFTER work is done.

    See how easy this is?

    • Not really. Not paying is like walking out of a grocery store without paying. Doesn’t warrant an alert. The fact there is a legal term ‘contractor fraud’ says something. Regardless, there should be a payment schedule or something that makes sense. Generally homeowners are HAPPY to pay for a job that was done right. Sadly, in this industry it is a true post.

  2. In Toms River township, there is a sign NOT to pay your contractor till after final inspection.
    I don’t wonder why! They must be aware of this….

  3. As a contractor myself I can tell you firsthand there are people who don’t pay their contractors for no reason other than them running out of money or simply not wanting to depart from their cash. If you don’t believe me I’ll give you names and numbers of people right here in Lakewood. So it’s important not to let that happen either

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