Losing money to a contractor without getting anything in return can feel devastating and stressful — especially when so much is at stake. Contractors are expensive, and many people save for years or borrow large sums to have work done. What’s more, a dispute involving a contractor can feel highly personal because it affects the place that’s supposed to be your sanctuary: your home.
But there are steps you can take to resolve the matter. Start by sending a written demand letter by certified mail. You can also check the contractor’s license, report them to the BBB, take them to small claims court, or hire an attorney for more extensive legal action. No matter what, document everything throughout the process.
Find Out if Your Contractor Really Disappeared
But first, has your contractor really disappeared? Legally, there’s a difference between an unplanned delay and outright abandonment. If the contractor is just not taking the project seriously by sticking to the original timeline, a sternly worded letter might get things back on track. Check your contract start date, read the fine print, and send one last dated message before concluding that the contractor took the deposit and disappeared.
Check Your State Laws
The law around licensed contractors varies by state. For example, in Florida, if you pay a deposit of more than 10% of the project cost and the work never starts, you may have a remedy under that state’s laws. And in Maryland, a home improvement contractor cannot accept a deposit of more than one-third of the total contract price. Many states, like Texas, for example, don’t license general contractors at all.
Determine If It Is a Contract Dispute or a Crime
Depending on the facts, a disappearing contractor may be a civil matter or a criminal one:
- Civil matters— When a party fails to uphold their side of a construction contract, it can be considered a breach of contract. Project delays, delivering substandard work, or failing to deliver any work at all can result in a breach of contract. Breach is a civil matter that can often be resolved through arbitration, depending on the contract terms.
- Criminal matters — Unfortunately, not all contractors operate legally. Some deliberately scam their customers by taking money for services they never intended to provide. When this happens, the matter can become criminal. A contractor can face criminal charges when their actions go beyond bad business practices and become intentional misrepresentations that violate state or federal laws. The exact rules depend heavily on the state, the contractor’s actions, and the evidence involved.
Steps To Take When a Contractor Disappears
Gather proof. If a contractor disappears with your deposit, keep every record you can. You’ll need your home improvement contract, records of correspondence, including texts and emails, photos documenting the (lack of) progress, and any other records you may have.
Send a formal written demand letter. Send your demand letter to the contractor’s last known address. Use certified mail and make sure that you keep a copy of the letter for yourself. Keep the statement simple, clear, and direct.
Report the matter to regulators or the BBB. Check your contractor’s license and report their work to the licensing board if one applies, the state attorney general’s consumer protection division, and local consumer offices. You can also file a police report if no work was done.
Take legal action. Pursue a claim in small claims court or contact an attorney for legal advice about filing a lawsuit. Blogs are helpful, but case outcomes depend on the facts of your case. And seemingly small issues can be legally significant in court.
Get Help With Contractor Disputes
Of course, there are things you can do to prevent contractor rip-offs, including checking references, confirming that the contractor is licensed, bonded, and insured, asking lots of questions, and carefully reviewing a written contract before signing anything. You can also choose to pay your deposit with a credit card instead of paying with cash, checks, or standard debit cards. Your credit card offers you protection against contractor fraud or botched projects. If your contractor disappears, you can request a chargeback.
No matter what, you might want to talk with an attorney about your legal options. Hiring a lawyer to fight for your legal rights can give you the peace of mind that an experienced expert is on your side.
