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Red Flags to Watch for When Hiring a Contractor  

This week I received 2 calls from citizens that hired what they thought were “licensed” contractors. They are now dealing with work that is not up to code, they have lost over $10,000 each, the “contractors” are no where to be found.

In addition, we receive a call from a homeowner hiring an unlicensed contractor several months ago paid $10,000 then because of mismanaged work, did not pay the balance owed of $8,000 and the unlicensed contractor filed a judgment against the homeowner. In this case, the unlicensed contractor was not aware that they have no right to sue for payment for unlicensed work. However, once the unlicensed contractor is paid, there is no statutory (quick) way to force them to issue a refund. There is recourse in both of these situations because the unlicensed contractor worked outside the scope of the handyman exemption ($1,000) minimum for work without a license. However, the recourse does not automatically offer restitution and will have to involve attorney representation, therefore costing these homeowners more money.

Two weeks ago I received a call from an elderly 84 year old man in Dewey that needed a new roof. He called YCCA for referrals. He received 3 estimates, all within the same dollar amount for a total roof replacement. He is on a limited income and felt he could not afford this work. He read an ad in a local free newspaper for roofing and called the number. He met with this “roofer” and shared with him he was on a limited income, could not afford any of the estimates he received and this “roofer” told him he understood the situation, said he would be willing to help him and give him a price that would fit within his means. The “roofer” said for this special price he would need payment in advance. He was paid in full with a cashiers check never to be seen again. The ad was paid for in cash, the phone number was a pre-paid toss away cell.

Before you leap into a working relationship with a contractor, and particularly before you make payment, take a careful look at the contractor you are hiring. We have lots of good, hardworking, ethical, reliable contractors in our area. We also have “contractors” that have a history of making false representations, abandoning jobs or doing shoddy work. If an unlicensed or improperly licensed contractor performs substandard work, and the homeowner, assuming the contractor is properly licensed pays the contractor anyway, the court will not order a refund based upon lack of license along.

When hiring for work, it is important not to step over a dollar to pick up a dime. Call YCCA before you hire. We can vet your contractor.

Watch for these red flags:

  • Wants to be paid in cash.
  • Wants you to make payment to a personal name and not a company name.
  • Wants you to pull a permit and act as owner/builder.
  • Gives you a very low bid.
  • Wants a large deposit up front.
  • Will not give you copies of workers comp or liability insurance. Did you know an unlicensed contractor who gets hurt on your property could sue you—and win?
  • Does not have business cards or contract paperwork with company name, license number and address.

Phone: (928) 778-0040


810 E. Sheldon Street, Prescott, AZ 86301

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