The Philadelphia Personal Injury Law Blog

Home Improvement Contracts and Fraud

You should exercise caution if you are hiring a contractor to perform improvements on your home. Understanding home improvement contracts and preventing fraud is important as it can impact not only your finances, but where you live as well.

What is Home Improvement Fraud?

Some common types of home improvement fraud as provided by the Pennsylvania Attorney General include:

  • Intentionally giving false or misleading information.
  • Receiving payment, but failing to provide the contracted services.
  • Changing the terms of a contract unilaterally and increasing the costs.
  • Publishing false or deceptive advertising.

What Must Be in a Home Improvement Contract?

To help prevent fraud, you should know that contractors must include certain terms in home improvement contracts:

  • Contractor's registration number.
  • Name, telephone number, and address of the contractor and subcontractors.
  • Description of the work to be performed including the approximate starting and completion dates of the project.
  • Total costs to consumer under the contract.
  • Amount of any down payment.
  • Amount of any liability insurance coverage maintained by the contractor.
  • Notice of the consumer's right to rescind the contract.

What Are Your Rights?

  • You have the right to the complete copy of the home improvement contract.
  • You have the right to rescind your home improvement contract without penalty within three business days of the signing date.
  • A contract that does not include all of the required information above is not enforceable.
  • A contractor may not demand payment before the contract is signed.

Preventing Home Improvement Fraud

Besides making sure that a home improvement contract meets the necessary requirements, you can also help prevent fraud by:

  • Asking for references and performing a background check of the contractor on the Internet.
  • Not falling for high-pressure sales tactics and walking away from contracts that are too good to be true.
  • Not paying for the entire cost of the job upfront.

If you believe you have fallen victim to home improvement fraud, you may want to contact a consumer protection attorney.

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