Foundation Repair Scams Are Costing Homeowners Thousands – Here’s How to Protect Yourself

Foundation repair is one of the most expensive home maintenance issues homeowners face, with costs often reaching tens of thousands of dollars. Unfortunately, this high-stakes industry has attracted unscrupulous contractors who prey on homeowners’ fears and lack of technical knowledge. Understanding the red flags of foundation repair scams and knowing how to verify contractor credentials can save you from financial disaster and ensure your home gets the quality repairs it needs.

Common Foundation Repair Scam Tactics

Foundation repair scammers employ several manipulative tactics to pressure homeowners into unnecessary or overpriced work. Foundation repair companies will claim that your foundation has shifted and by letting them install their system, they will “stabilize” your foundation from additional movement. However, they fail to tell you what might be causing the foundation movement or what impact foundation repair will really have on your foundation.

One of the most common scams involves companies telling you that you need to pier your whole home when most honest foundation repair contractors will tell you that you only need piers in the affected area. Piering your whole home is not necessary unless your whole home is affected – which is extremely rare. This unnecessary work can cost homeowners significantly more than addressing only the problem areas.

Another deceptive practice is the “fake pile” scam, where the foundation contractor has the lowest price, but without the client’s knowledge, the piles are not pushed into the ground at all. They are simply just laid on the ground, and the structure can still be leveled. It will not last very long, and you will be forced to hire someone to do the foundation repairs correctly.

Red Flags to Watch For

Several warning signs can help you identify potential scammers before they take advantage of you:

• High-pressure sales tactics: Scammers may make a special discounted offer to push you to make a decision right away and pressure you to hire them immediately.
• Door-to-door solicitation: Shows up uninvited is a major red flag, especially after storms or natural disasters.
• Demands upfront payment: If they’re asking for cash up front before the work gets started, before a contract can get put into place, that’s one of the bigger red flags.
• No written contract: Doesn’t provide a written agreement or contract. Everything should be in writing.
• Lack of proper credentials: Red flags should come up if a contractor cannot get a permit OR if they say that the home owner is required to get the permit.

Be especially wary of contractors who claim their systems have special government approvals. Occasionally one will find an advertisement that says the company’s piers are FHA approved, or VA approved. We have researched and investigated for years how we can also get approved by FHA or VA, but there is no such thing. It’s a scam.

How to Verify Contractor Credentials

Protecting yourself from foundation repair scams starts with thoroughly vetting any contractor before signing a contract. Here’s how to verify their credentials:

Check Licensing

Verify the contractor’s license by checking with your state or local licensing board to confirm their credentials and status. Request their Certificate of Insurance (COI), which should outline their liability and workers’ compensation coverage. Most states have online databases where you can search by contractor name or license number.

Verify Insurance and Bonding

A legitimate contractor should carry both liability insurance and workers’ compensation insurance. Always ask for proof of insurance, such as a certificate, and then call the provider to check that the policy is up to date and will cover your project. Don’t just take their word for it – there have been cases of contractors presenting fake insurance documents. Always follow up directly with the insurance company to confirm the coverage is real and current.

Research Their Background

Verifying their credentials involves researching their background, checking references, and using reputable resources like the Better Business Bureau. Start by doing some homework on your potential contractor. Look up online reviews, but read them critically, and contact previous customers directly when possible.

Get Multiple Estimates

Get multiple estimates. A written estimate should include a description of the work to be done, materials, completion date, and the price. Don’t automatically choose the lowest bidder. And ask for an explanation if there’s a big difference among the estimates.

Working with Reputable Foundation Contractors

When dealing with foundation issues, including cracks in foundation walls, it’s crucial to work with established, reputable contractors who have a proven track record in your area. Companies like Diamond Masonry & Waterproofing, which has been serving Long Island homeowners since 2000, demonstrate the kind of longevity and local reputation you should look for in a foundation contractor.

Diamond Masonry & Waterproofing exemplifies what to look for in a legitimate foundation repair company. As a family-owned business with over 25 years of experience, they operate with transparency and maintain strong customer relationships. Their commitment to customer satisfaction is evidenced by their 5-star rating and numerous positive reviews from Long Island homeowners.

Protecting Yourself During the Process

Even after choosing a contractor, remain vigilant throughout the repair process:

• Insist on detailed contracts: Read your contract carefully, ensuring yourself that the foundation repair contractor will actually raise the foundation to a reasonably level position. Make sure that the existing piers under the perimeter concrete beam are being severed so that the house can be raised.
• Monitor the work: Hiring your own engineer to inspect the jobsite as the work is performed can save you a lot of money.
• Verify worker credentials: Insist that all workers are full time employees, that none of them are sub contractors, independent contractors, or street corner helpers in any way. You want drug tested, time tested, and quality workers at your home.

Taking Action Against Scammers

If you suspect you’ve encountered a foundation repair scam or have been victimized, act quickly. Document what happened by writing down as much as you remember, including any names and dates. Report the fraud to your local law enforcement and file a complaint with your state’s consumer protection agency or the Better Business Bureau.

Foundation repair is a significant investment in your home’s structural integrity and safety. By understanding common scam tactics, thoroughly vetting contractors, and insisting on proper documentation and credentials, you can protect yourself from fraudulent operators while ensuring your foundation receives the quality repairs it needs. Remember, legitimate contractors welcome scrutiny of their credentials and won’t pressure you into immediate decisions – they understand that foundation work is too important to rush.