Red Flags to Watch for When Hiring a Home Contractor in Florida

Florida’s thriving real estate market has led to a surge in home renovations, but it has also opened the door to contractor fraud. According to the Federal Trade Commission (FTC), home improvement scams are among the most common consumer complaints, with Florida ranking high in fraud cases.

Hiring an unreliable contractor can result in financial loss, subpar work, and even legal trouble. Many homeowners find themselves dealing with contractors who abandon projects, use low-quality materials, or operate without proper licensing. This guide highlights key red flags to watch for and provides actionable steps to ensure a safe and successful hiring process.

Why Choosing the Right Contractor Matters

Home renovations and repairs require a significant financial investment, and hiring the wrong contractor can lead to major issues. Poor workmanship, legal disputes, and financial fraud are just some of the risks homeowners face when they fail to properly vet a contractor.

Florida has strict contractor licensing requirements, enforced by the Department of Business and Professional Regulation (DBPR). Working with an unlicensed or unqualified contractor can:

• Lower your home’s value due to poor renovations.
• Expose you to legal issues if the work does not meet building codes.
• Result in financial loss if the contractor abandons the project or overcharges.

Homeowners must be vigilant in verifying a contractor’s credentials and watching for red flags that indicate potential fraud or incompetence.

Key Red Flags to Watch for When Hiring a Contractor

No License or Insurance

Florida law requires all contractors performing structural work, electrical services, plumbing, or HVAC installations to hold a valid license. Licensing ensures that the contractor has met state qualifications and follows safety regulations.

However, many fraudulent or underqualified contractors operate without a license, putting homeowners at risk. A lack of insurance is another major red flag, as it means the homeowner may be held financially responsible for accidents or property damage.

How to Verify a Contractor’s License in Florida

• Search the contractor’s name or license number on com.
• Request proof of general liability insurance and workers’ compensation.
• Check with the Better Business Bureau (BBB) for complaints or disciplinary actions.

Asking for Large Upfront Payments

While deposits are standard, an excessive upfront payment can be a warning sign. Some contractors take large deposits and then disappear, leaving homeowners with unfinished projects.

Florida law limits upfront payments to 10% of the total contract price for jobs requiring permits. A contractor demanding full or large prepayments may be financially unstable or planning to abandon the job.

No Physical Address or Online Presence

A legitimate contractor should have an established business presence. Many fraudulent contractors operate under multiple names and avoid having a trackable address. If a contractor refuses to provide a business address or only operates through word-of-mouth, proceed with caution.

How Public Property Records Can Help

Checking public property records can verify whether a contractor has worked on local properties as claimed. Some fraudulent contractors falsely advertise having completed renovations for specific homes when they have not. A property record search can confirm their claims.

Unclear or No Written Contract

A verbal agreement is not legally binding and leaves homeowners vulnerable to sudden cost increases, unfinished work, or misrepresented services. A professional contractor will always provide a detailed, written contract.

A contract should include:

• Scope of Work: A clear description of the tasks to be completed.
• Project Timeline: Start and estimated completion dates.
• Payment Terms: A breakdown of costs and a milestone-based payment plan.
• Warranty Coverage: Terms for labor and materials.

Avoid contractors who refuse to provide a written contract or present vague terms.

High-Pressure Sales Tactics

Fraudulent contractors often use high-pressure tactics to push homeowners into making quick decisions. They might claim that the offer is only available for a limited time or that a permit isn’t required to rush homeowners into signing an agreement.

Why Checking Criminal Records Matters

Some contractors have a history of fraud, financial crimes, or contractor scams. Conducting a criminal record search online can reveal past convictions for fraud or legal disputes related to home improvement projects. This extra step can prevent hiring a contractor with a history of misconduct.

No Permits or Inspections

Many home renovation projects in Florida require permits to comply with local building codes. If a contractor claims that a permit is unnecessary or asks the homeowner to pull the permit on their behalf, it’s a red flag.

Failing to obtain the proper permits can lead to:

• Costly fines.
• Insurance denial if damage occurs due to unapproved work.
• Legal issues when selling the home due to non-compliant renovations.

Always verify that necessary permits are obtained before work begins.

How to Protect Yourself When Hiring a Contractor

Verify Licenses and Credentials

Working with a licensed contractor ensures compliance with state regulations, quality standards, and safety protocols. Licensed professionals are also more likely to honor contracts and warranties.

The Role of Licensed Contractors in Home Improvement

• Licensed contractors are accountable to state regulators.
• They follow proper permitting procedures.
• They carry insurance, reducing the homeowner’s liability for accidents.

Get Multiple Bids and References

Homeowners should always compare multiple contractors before making a final decision. Accepting the first offer without exploring alternatives increases the risk of being overcharged or hiring an underqualified contractor.

When evaluating bids:

• Collect at least three estimates for the project.
• Ask for a list of previous clients and contact them to verify work quality.
• Visit an ongoing job site (if possible) to assess professionalism and craftsmanship.

Use Secure Payment Methods

One of the biggest mistakes homeowners make is paying contractors in cash or making full payments upfront. Secure payment methods protect against fraud and ensure the contractor is accountable for completing the work.

Safe payment practices include:

• Using credit cards or escrow services for larger transactions.
• Releasing payments only after project milestones are met.
• Keeping copies of all invoices and receipts.

What to Do If You’ve Hired a Bad Contractor

If a contractor fails to meet expectations, homeowners have several options to seek resolution.

Steps to Take if You Suspect Contractor Fraud

1. Communicate with the Contractor – Attempt to resolve issues directly.
2. File a Complaint – Report the contractor to the Florida DBPR.
3. Contact Consumer Protection Agencies – File a report with the Federal Trade Commission (FTC) or the Better Business Bureau (BBB).
4. Consider Legal Action – If the financial loss is significant, consulting an attorney or taking the contractor to small claims court may be necessary.

Florida also has recovery funds that assist homeowners in recouping losses from fraudulent contractors.

Hiring the right contractor requires careful research and due diligence. By recognizing red flags such as missing licenses, high-pressure sales tactics, and avoiding permits, homeowners can protect their investments and avoid costly mistakes.

• Use public property records to verify a contractor’s claims.
• Check criminal records online to avoid hiring someone with a history of fraud.
• Ensure the contractor is licensed and insured to prevent financial and legal risks.

Taking these precautions will help ensure that home renovation projects are completed safely, legally, and successfully.