Summer Savings! Get unlimited digital access for 13 weeks for $13.
Business Money

Count on shady businesses cropping up in wake of storm

It happens after every natural catastrophe. Once the winds die down, the water recedes or the fire is doused, shady contractors appear on the scene to make affected homeowners victims twice over.

"You see a rash of this after a natural disaster," says Bill Gruhn, chief of Maryland's consumer protection division. "Sometimes they take the money and don't do the work; sometimes they take the money and terribly overcharge people. And sometimes they take the money and do very poor work."

The violent "derecho" storm that swept Maryland on Friday night is unlikely to be the exception to this rule.

Some Marylanders are bound to be approached by strangers who promise to repair roofs and remove fallen trees — and wind up only taking consumers' money. Price-gouging is also likely. It's not illegal in Maryland, but it's certainly unfair.

Granted, if your house is damaged or you have a tree reclining on the front lawn, you want to get the problem fixed as quickly as possible. But taking some extra time to find a reputable contractor or tree care professional can protect you from another type of disaster.

Here are some tips:

Beware of storm chasers: These are unlicensed workers who travel around the country on the heels of storms to offer roof and siding repair or tree-trimming services.

Storm chasers often have magnetic signs on their trucks that can be changed from town to town, says Jody Thomas, vice president of communications for the Better Business Bureau of Greater Maryland. These operators also won't have a permanent address on their paperwork or business cards, Thomas says. And they will pressure homeowners to hire them on the spot.

And because these contractors are unlicensed, homeowners won't have certain consumer protections if problems occur, Thomas warns.

"We recommend, if a stranger comes to your door offering to do work, just say, 'No,'" says Paul Shepherd, a spokesman with Angie's List, a service that grades businesses based on customer reports.

"The best companies are going to be busy," says Shepherd, adding that legitimate firms will be able to prioritize jobs based on the severity of damage. "Be wary of the companies that have too much time on their hands."

Check licenses: Instead of waiting for a contractor or tree service to find you, ask friends and neighbors for companies they have hired and recommend.

Make sure contractors you're considering are licensed by the Maryland Home Improvement Commission. Licenses can be checked online at Or you can call 410-230-6309 to find out if contractors are licensed or have had complaints filed against them.

Work with an unlicensed business, and you won't be able to be reimbursed by a state-run guaranty fund if the contractor does poor work or leaves the job undone.

"If they're not licensed, they won't be insured," Thomas says — which means that if these hired hands are injured on the job, the homeowner could be liable.

Tree professionals in Maryland must be licensed by the state's Department of Natural Resources. Check the license at A tree servicer also must be insured against damage it may do to your property and any injuries suffered by its workers while on the job, Gruhn says.

Don't forget to check the Better Business Bureau at for more information on how a company treats its customers.

Bids and down payments: Get at least three bids in writing from contractors.

"If one comes in really low and one really high, that third one can determine who is really being accurate with their pricing," Shepherd says.

Be wary of the ultra-low bid. This could be a warning sign that the contractor is trying to lure you with a cheap price and will ask later for more money, claiming the job is more extensive than anticipated or the materials are more expensive. Or the contractor could be giving you a bid for only part of the job.

Also, beware of a home improvement contractor that asks for all its money upfront. In Maryland, such contractors cannot demand more than one-third of the price of the project in advance.

"We often recommend you tie the remaining payments to progress made on the project," Shepherd says. The final payment can be made when the project is done to the homeowner's satisfaction, he says.

Maryland generally has stronger consumer protections than many states, but it doesn't have a law that bans price-gouging. However, Gruhn says regulators have been able to pursue cases against companies for unfair business practices when the firms didn't tell the consumer the steep price of services ahead of time.

Details, details: Once you decide on a contractor, make sure the two of you are on the same page when it comes to the contract, Shepherd says. The contract should spell out the details of the job, including the scope, materials to be used, start and finish dates, and payment terms, he says.

Advance-fee loans: Homeowners who don't have the cash to make repairs should be wary of companies that guarantee they'll get them a loan — provided consumers pay a fee first. These schemes are illegal.

"They are not looking to lend you money; they are looking to take your money," Gruhn says. "You never get a loan."

Copyright © 2015, The Baltimore Sun
Related Content
  • Consuming Interests blog

    Consuming Interests blog

  • Pictures: Tips to cut down your grocery bill

    Pictures: Tips to cut down your grocery bill

    Is it possible to eat for $7 or less a day? Zack, an aspiring comedian, says he does it. Here's how, along with more strategies anyone can use. --Kimberly Palmer, U.S. News & World Report

  • How to find bargains

    How to find bargains

    Throughout the year, I write tips on how to get bargains and deals on a variety of items and services. For a comprehensive guide to markdowns, discounts and strategies to save money, see The Best Bargains, from the August issue of Kiplinger's Personal Finance magazine. Below you'll find a sample...

  • 10 places (beside the newspaper) to find coupons

    10 places (beside the newspaper) to find coupons

    When the Frugalista grocery shops, other people in line are surprisingly supportive of the coupon use going on, even though it takes me longer to check out. Other shoppers always want to know where I get all those coupons. I get them everywhere. Newspapers are far from the only place to find grocery...

  • How to stretch your paycheck

    How to stretch your paycheck

    You keep asking yourself: Where has all the money gone? Of course, you have a good idea: It has gone to spending on groceries, cell phone and cable bills, mortgage and insurance payments, and maybe even on a weekly night out for dinner and on a daily cup of latte. With a few phone calls and adjustments,...

  • Extraordinary uses for ordinary items

    Extraordinary uses for ordinary items

    Some ordinary, unassuming household objects have super powers. And most of these items cost less than a couple of bucks. So the next time you stain a shirt, smell something funky or think about tossing a banana peel, check these 100-plus uses first. Not only will you be going green, you'll be saving...