5 Roofing Scams to Avoid
Homeowners fall victim to a variety of roofing scams each year. Angie's List spoke to five highly rated roofing contractors about how to avoid the most common scams.
The roof is one of the most important components of any home. No part plays a bigger role in keeping the elements out, so when a roof requires repair, you have little time to waste.
The desire to have a roof quickly replaced and the fact that most people have little experience working with a roofing contractor can set an unsuspecting homeowner up for a variety of scams.
Fraudulent roofing contractors prey on vulnerable homeowners and have become increasingly bold in their tactics. From unlicensed storm chasers to mysterious door-to-door salesman, there are many ways to fall victim to roofing scams.
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The Disappearing Down Payment
A common roofing scam occurs when a company agrees to replace a roof, but requires a down payment before starting the work. The company will say it needs the down payment to buy materials or to pay for labor, but it never returns once the check is in hand.
In most cases, the company will convince the homeowner to sign over or cash an insurance check as a down payment and then disappear.
Eric Brown and Chris Tulp of highly rated Premier Roofing say the scam happens all the time.
“It typically happens to homeowners who have the home paid for because the checks are often made out to the homeowner and the mortgage company,” Brown says. The scammers target these people because it often takes a long time for the mortgage company to release the funds.
However, the scam is still common for people who are still financing their homes. “A big scam that we see is even if the home does have a mortgage on it and the insurance check is made out to homeowner and mortgagee, the roofer will forge an endorsement stamp on the back so they can deposit it,” Tulp says. “It’s a major crime.”
Don't Hand Over Your Insurance Check
The Denver roofers say that when a homeowner files a claim with his or her insurance company, the company sends out an adjuster to take note of the damage. The insurance company then issues a check for less than the total replacement cost. The homeowner is supposed to use the funds as an initial payment. Once the contractor completes the job, the bill is sent to the insurance company to pay the remaining balance.
“When you have contractors taking advantage of homeowners, it’s typically that first check that they take and disappear,” Tulp says.
Both Tulp and Brown agree that you should never pay a down payment to a roofing company until supplies have been delivered.
“The safest way to guarantee that you never get ripped off is to not do business with somebody who won’t start your project or at least drop materials without a down payment,” Tulp says. “If you don’t give them any money, you can’t be taken advantage of.”
The Door-to-Door Salesman
One of the biggest scams in the roofing industry involves the door-to-door salesman who shows up unannounced with the promise of a free roof.
“I have seen and heard so many stories from customers and friends of mine who have been approached or scammed by the door-to-door sales guy that I have lost count,” says Kevin McHugh, owner of highly rated BTR Construction & Roofing in Charlotte, N.C. “These salesmen are trained to sell, and sell hard. They don’t just target senior citizens, every homeowner is fair game.”
These scammers will target neighborhoods with a large number of senior citizens, older homes or where a major storm has hit.
Under the disguise of a free roof inspection, the scammer will go up on the roof and fabricate damage to mimic storm damage, or present a photo showing roof damage from a different home and claim it came from the homeowner’s roof. McHugh says he’s heard of salesman tearing off shingles to simulate wind damage, or hitting the roof with an instrument such as a ball-peen hammer to fabricate hail strikes.
“If the salesman creates damage during an inspection process, it’s usually because they feel the roof doesn’t have enough damage to get covered by the insurance company,” McHugh says. “If the insurance company denies the claim, they lose a sale.”
McHugh says this negatively affects homeowners in several ways. “Without the fabricated damage the homeowner would have no need to replace the existing roof, or get the full remaining value out of the roof,” he says. “Not to mention that filing a claim goes on your insurance record and could possibly affect future claims or even prompt the insurance company to not renew your coverage, forcing the homeowner to get a new policy from a new carrier.”
To protect yourself from this scam, the Charlotte roofer warns against signing any paperwork until your insurance company has inspected the roof. He also recommends investigating the company’s background, visiting its office and interviewing previous clients.
“Some door-to-door companies are honest and will do the job professionally,” he says, but homeowners need to exercise extra vigilance.
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The Storm Chaser
Out of all the roofing scammers, the out-of-town storm chasers are the most publicized, yet people all across the country fall victim to them. Also known as roofing gypsies, these roofers travel around the country following the paths of storms looking for homeowners to exploit.
“The Weather Bureau will say which areas have hail or wind damage,” says Paul Tansey, owner of highly rated Tans’ Quality Roofing Inc. in Chicago. “The chasers pay attention to those readings and they know the insurance companies will allow for roof replacement in those areas.”
The way the scam works is the storm chasers will blanket an area hit by hail or wind damage and look for unsuspecting homeowners in need of roof repairs. They’ll pass out leaflets and even show up unannounced or offer a free inspection.
Signs of a Storm Chasing Contractor
The Chicago roofer says the chasers know how the insurance companies work, and based on the square footage of the roof, they can figure out how much it will cost to put on a cheap new roof. The homeowner gets burned because the storm chaser only does the bare minimum to replace the roof, but doesn’t address any other problems, or restore the roof to its original condition.
The homeowner is then left with a poorly constructed roof, and the fraudulent company that was once so ready to help has vanished.
“When a roof is put on by a storm chaser, normally those roofs only last 5 to 7 years and then I have to tell the homeowner their roof needs to be replaced," Tansey says.
How to Avoid Storm Scams
The storm chasers have no incentive to produce high quality work, and there’s really no way for them to be held accountable because they will be gone by the time a problem arises.
Aside from the shoddy work, many of the storm chasers lack a valid license, don’t hold insurance or will lie about having insurance.
You should also pay a visit to the roofer’s office. If the company only lists a post office box, it’s a major red flag. It’s also smart to ask for a list of previous customers in your area, and you should visit the work sites to make sure the references are legit.
One all-too-common roofing scam involves a contractor who will show up to a scheduled consultation, or unannounced in a neighborhood where other homes are having roofing work done. Promising a special deal or exceptionally low rate, the roofing contractor will pressure the homeowner to sign a contract on the spot.
If the homeowner puts up any kind of resistance to the sales pitch, the contractor will make dishonest claims or mislead the homeowner to enter a legally binding contract.
Scott MacMillan, president of highly rated A Better Roofing Company in Seattle says the high-pressure approach happens all the time in the roofing industry. “A roof is only done once or twice in a person's lifetime, so it’s easy to fall victim because there is no point of reference or very little experience in making such a large purchase,” he says.
MacMillan says the reason roofing companies revert to high-pressure tactics is because they typically charge a higher rate and want to get the homeowner to sign a contract and pay a down payment without consulting other companies.
“They want to get the homeowner into a legally binding contract before they've gotten other bids, and because nobody wants to get involved in a legal battle unless absolutely necessary, it’s usually too late if other estimates come in after the homeowner has already signed up with these dishonest companies,” he says.
Tips for Avoiding These Roofers
MacMillan offers the following tips for homeowners:
1. Do not agree to give a down payment on a roofing project. “A reputable contractor will not be afraid to commit to the project with their own money.”
2. Beware of any roofer who demands “both decision makers” be present for a consultation. “That tactic prevents the homeowner from being able to say something like ‘I will talk this over with my spouse and get back to you,’ and also take some extra time to make an educated decision.”
3. If you feel uncomfortable for any reason, ask the contractor to leave. “I have heard before that they’ll do everything possible to avoid leaving because the likelihood of closing the sale diminishes exponentially once they walk out the door.” The Seattle roofing contractor recommends calling the police if a roofer fails to leave after you have asked him or her to do so.
The Fluctuating Bid
In a roofing scam sometimes referred to as the “elevator ride,” a contractor will offer a low bid that is far less than other companies in the area. The contractor knows the homeowner doesn’t have a lot of experience dealing with a roof replacement and since it’s an expensive job to begin with, the homeowner jumps at the low bid.
Once the job begins, unexpected costs and unforeseen problems suddenly appear. The contractor might claim an increase in the cost of materials, or find damage that wasn’t addressed when the contract was agreed upon. In some instances, the contractor will literally remove the old roof and threaten to leave if additional payments aren’t made.
By the time the job is finished, it ends up costing substantially more than what was initially agreed upon.
Doug Miller, president of highly rated Coomer Roofing Co. in Indianapolis says material prices do change in the roofing industry, but it’s a major red flag if a contractor tries to increase the price mid-project.
“Materials do go up all the time but every reputable contractor gets notices from the manufacturer weeks before the price goes up,” Miller says. “The price of materials going up is not the homeowner’s responsibility to pay.”
Ask About Roof Deck Damage
Miller says the one area of the roof that can’t be examined prior to starting a job is the roof’s decking, which is essentially the bottom layer or foundation of the roof where everything else is laid.
The Indianapolis roofer says most legitimate roofing companies will include a section in their contracts that explains how any damage to a roof’s decking will be addressed and how much it will cost to replace per square foot. Miller says most companies charge around $1.50 per square foot to replace damaged decking.
To prevent a situation like this from occurring, Miller says a roofing contract must contain a section that lists the total cost of labor plus materials, as well as how the contractor will handle damage to the roof’s decking.
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