
4. Do Not Pay With Cash.
As previously mentioned, if you are dealing with a contractor who insists on only taking cash or check, just say no. Credit card companies may have blocked them from engaging in unethical business practices. You also do not want to work with a contractor who insists on a substantial down payment. According to the Federal Trade Commission, the safest way to pay for any home renovation project is through a credit card. People cannot trace cash payments. If the whole home renovation project ends up falling flat, you will have few options for justice if you pay in cash. Checks offer slight protection. Of course, that is only to the extent that you can cancel the check before the scammer cashes it.
However, credit card companies are very adept at tracing where their credit cards are being used and the reputation of the company or individual receiving the payment. If they report that a particular proprietor acts with poor ethics, they can stop all future payments to that entity. They also can offer options in case there are problems with the quality of the work. Putting money on your credit card instead of shady financial institutions can also prevent any financing scams. Again, if the contractor tells you not to bother using your credit card or acts confused when the credit card company declines to process the payment, take that as a clear sign that you do not want this person inside your home.