The Property Casualty Insurers Association of America has already put out a warning: homeowners need to be aware of whom they are hiring to clean up or rebuild their homes in the aftermath of Hurricane Katrina. The environment is ripe for the vulnerable to become easy prey to the unscrupulous.
“As the rebuilding process gets underway, unlicensed contractors and scam artists will be looking to cash in on your misfortune,” said John Eager, senior director of claims for PCI.
To Marty Milstead, executive vice president of the Home Builders Association of Mississippi (HBAM), he sees no difference between unlicensed homebuilders and con men. They are the same in his book.
“I’m not going to go out and operate on someone just because I watched a medical show on TV the night before,” he said. “If homebuilders are doing work without a license, without workers’ comp, without general liability insurance — whatever — in my mind they are nothing but con artists.”
Milstead said he could not give an estimate of just how widespread homebuilding scams might be as the massive post-storm construction process gets underway. But he did say it is already occurring, and the examples include more than just shoddy workmanship or the basic take-the-money-and-run scheme.
“It’s happening now on the Mississippi Gulf Coast,” said Milstead, who is struggling with personal loss from the storm — his parent’s home was ruined and his sister was flooded out. (All are safe, however.) “We’ve got people riding around in neighborhoods looking for roofing crews. They find one, and offer them more money if they’ll leave that site and come to another one and work. So, the homeowner is left with, let’s say, half a roof, and the crew is gone. That’s already happening here in Mississippi.”
Patience and prudence
Owners with damaged or destroyed homes make for relatively easy marks for scam artists. People are desperate to get their lives back together again, and having a safe, dry home understandably ranks high on their list as they struggle to return to some sense of normalcy.
However, those emotions can lead to hasty and, too often, poor decisions when choosing a contractor.
Eager said, “It is natural for homeowners to be in a hurry to begin making repairs following a natural disaster.”
Milstead echoed that statement. He has spent a lot of time on the Coast since Katrina, and said no one understands what those homeowners are going through better than him. But he still urges affected homeowners to do two things.
“Be patient, and be prudent,” Milstead said. “Some things are starting to return to normal. Grocery stores are open. The lines at gas stations are gone. It’s only natural that homeowners in the next phase of recovery would be anxious to get their homes repaired or rebuilt. But they want it, well, immediately. We want the work of rebuilding homes to move quickly, but also safely and professionally.”
It’s important that area homeowners heed the warnings of potential scams. As Milstead pointed out, homeowners have to self-police themselves.
That is not to say homeowners cannot expect some help in watching out for the unscrupulous. Milstead said he is hoping the Federal Emergency Management Agency and state government, namely the Governor’s Office and the State Board of Contractors, enact measures that would help safeguard innocent and vulnerable homebuilders.
Still, homeowners are the front line defense against the con artists and unlicensed contractors. The HBAM offers tips homeowners can use to safeguard themselves on the organization’s Web site, http://www.hbam.com/. (Click on the link “How to Hire a Builder/ Contractor.”)
References and insurance
Milstead said, “Check references. Ask for proof of insurance. Get guarantees in writing. These are the things homeowners need to be doing to protect themselves. Once again, be patient and be prudent.”
It also important for homeowners to be aware that the State of Mississippi has allowed licensed, out-of-state builders to work in the affected areas with a 90-day license, which could be extended in the future. So, just because a builder is based outside the state does not necessarily mean that he is a rip-off artist.
“I would look at Mississippi-based homebuilders first,” Milstead said. “A lot of these outside homebuilders obviously are eventually going to leave. If after the work your roof leaks or your plumbing doesn’t work, you could have a problem. But, no, just because a homebuilder is from out of state does not automatically mean they are con men. There are good, reputable people from outside Mississippi looking to work here. And it’s an excellent opportunity for these out-of-state homebuilders.
“There’s no doubt that these scam artists create a problem for legitimate homebuilders, giving them and the whole industry a bad name. But more importantly, the legitimate homebuilders are down there trying to get friends, family and neighbors back on track, get their home restored, and these con artists are hindering that.”
Contact MBJ staff writer Wally Northway at email@example.com.