Connecticut Homeowners: How to Avoid Home Repair Rip-Offs

Homeowners have more to worry about than being ripped off by shady contractors in this lagging economy, but such a climate brings desperation -- and with it, sadly, fraud. Of course, the majority of tradesmen are generally honest professionals, but there is a large number of unscrupulous contractors who will fix items that don’t need fixing, or grossly overcharge you for services or parts. Worse, there are plenty of con artists posing as tradesmen who will simply take your money and run. Inspectors are often the first ones to uncover such fraud, so they too need to be familiar with its common forms in order to best serve their clients.

Some common home repair scams include:

• roof work. Con artists are known to travel from state to state following natural disasters and looking for victims of storms. Beware of people who suddenly arrive in your neighborhood, offering to fix your roof at a discount. Also, don’t trust a roofer who makes an assessment of a leaky roof from the ground without examining it. Very often, the flashing is all that needs to be replaced, even when the tradesman tries to convince you that you need a whole new roof.
• driveway sealers.  This time-honored grift has a tradesmen pulling up to your home in his truck and offering to re-seal your driveway using leftover "sealant" from a job "just down the block."  The low price is unbelievable, and so is the job.  Generally, the sealant is paint or some other cheap, black spray media that will quickly wash away with the next rain.
• termites. Myths that exaggerate the dangers of termites abound, and homeowners can be easily duped into unnecessary treatment. Ask for prices from more than one company and compare their services. Make sure to get a guarantee that covers you in case termites return within a given period of time. Read the guarantee and the rest of the contract carefully before you sign! Be on guard for the following ruses:
  • The exterminator shows you termites on a fence or woodpile that is not connected to your house. If he were competent and honest, he would know that these termites pose no threat to your home.
  • He (but not you) witnesses “evidence.” Make the exterminator show you the alleged evidence of the infestation. Termite-damaged wood is hollowed out along the grain, with bits of soil or mud lining the galleries.
  • He offers a free termite inspection, and his motives are questionable to begin with. He may bring the evidence to your house with him.
• chimney sweeps. Beware of any chimney sweep who arrives at your door unannounced, offering to perform his services for a low price. He might say that he's just worked on your neighbor’s chimney, and offer you a suspiciously low price for a sweep. The inspection will uncover "problems" that quickly balloon the price.
• HVAC specialists. The most common HVAC rip-offs are replacing parts that work fine and substituting used parts for new ones. If you get suspicious, ask to see the alleged broken parts before they're replaced, and look at the packaging and documentation for the new parts before they're installed. If possible, have HVAC work performed in the off-season, as it may be significantly cheaper.
• plumbers. Parts cost plumbers only a tiny fraction of the total charge for their services, but some plumbers will still cut corners to boost their profit. They may use plastic or low-grade metal, for instance, or 1/2-inch pipe instead of 3/4-inch pipe. Ask what they are installing and how long the parts will last.
• painters. Some painters agree to use a specific brand of high-quality paint, then pour cheap paint into name-brand cans. Most of the cans the painter brings with him should be sealed when the job is started. If not, ask why. Other painters skimp on the prep work.

Homeowners should heed the following advice whenever they hire a contractor:

• Go to OverSeeIt.com to find an InterNACHI inspector who will stop by and make sure your construction project is done right.
• If you are calling a contractor for an estimate and you live in an affluent neighborhood, don’t mention your address or phone number until you get the estimate. You can even call a tradesman in a less wealthy town or neighborhood that’s nearby, as their price will likely be lower than the going rate in your area.
• Try to negotiate a flat rate if the tradesman has no idea how much the job is going to cost. This is especially helpful in plumbing work, as almost all pipes are hidden behind walls and the job can easily become more complicated than originally planned.
• Ask if the tradesman charges for travel time. If he does, it may be cheaper to choose someone who is closer. Also ask if he charges for time spent traveling to supply stores.
• Know your contractor. Be sure he is licensed, and get a written agreement stating the cost and the work to be performed.
• Beware of any contractor who shows up at your door unannounced or calls you on the phone. Con artists must move every so often to frustrate law enforcement, so they have no fixed address and rely on door-to-door or phone solicitation. For the same reason, their invoices may contain only a P.O. box rather than a street address.
• Always be wary of a contractor who recommends a particular company or individual after “discovering” a problem, as he will probably receive a kickback for the referral, so you cannot trust his advice. 
• Beware of a contractor who tries to unnecessarily increase the scope of a project. Also known as an upseller, these people will do the following:
  • not offer you a range of options, including cheaper alternatives or work that is different than what you had anticipated; or
  • use scare tactics to persuade you to take his recommendations.
• Beware of contractors who insist that they are  charging you only for what they paid for the materials, if they are, in fact, making a profit on the materials. Material over-charging is unethical if the contractor lies about it.
• Beware of material-swapping, in which the contractor will buy premium products and make you reimburse him, but then he returns the product for something cheaper and of lower quality, and pockets the difference. If you suspect material-swapping, you can uncover the farce at the end of the job by comparing the packaging with the products listed on the receipt.
• Do not give a large down-payment. It may be appropriate to pay a small percentage of the total estimate up front, but if the contractor asks for most (or all) of the money up front, he may be a con artist. Even if he does return to perform the work, he may botch the job or leave it unfinished, leaving you with little power to contest. And, of course, never pay in cash.

• If you are elderly, be on heightened alert for scammers because you will be targeted more often than your children.

In summary, homeowners and inspectors alike should be wise to the plethora of ways that home repair contractors, or those posing as such, rip off their clients.

by Nick Gromicko and Rob London

Nick Gromicko, FOUNDER. http://www.nachi.org
International Association of Certified Home Inspectors (InterNACHI) is the world's most elite, non-profit inspection association.
President, ComInspect, www.cominspect.com
Director, Master Inspector Certification Board, www.certifiedmasterinspector.org
Author, 15 books and Co-Host of  http://www.NACHI.TV

We'll be on NPR Radio Tomorrow - "Fairfield County Focus" on WSHU

We are going to be on WSHU radio tomorrow morning and invite you to tune in!

WSHU, a local radio station serving Fairfield County CT  has over 300,000 weekly listeners and  is based out of Fairfield Connecticut.

Tomorrow's edition of   Fairfield  County Focus", which is hosted by Alison Freeland, centers around  Fairfield County real estate trends   and Judy is a guest panelist. Other panelists include local home inspector  John Oppenhimer,  owner of OpenHouse Inspections, and Ann Anderson, owner of Rooms Reborn, which is a home staging company.

We taped the show yesterday afternoon, and am sure you will enjoy the banter and all of the information.

We'd love for you to tune in tomorrow at 10AM.

Here's where to listen:

online at http://www.wshu.org

or on your radio at:

91.1 Fairfield, CT
90.1 Stamford, CT
106.5 Derby, CT
1260AM Westport, CT
93.3 Northford, CT
91.3 Huntington Sta., NY
91.7 Ridge, NY
103.3 Noyack, NY
89.9 Greenport, NY
105.7 Selden, NY

And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

Connecticut Financing Update and Today's Mortgage Rates 3/16/12

Despite the uneventful start to the week yesterday, Mortgages Rates are sharply higher today, rapidly re-introducing 4.0% as the more prevalent Best-Execution rate.  Yesterday, 3.875% was the clear choice for Best-Ex.  Movement between the two has been seen more frequently as rates in general have spent more time hovering in a narrow range between 3.875 and 4.0% on average so far in 2012.  (read more about Best-Execution calculations).

Bond markets began the day in negative territory and continued to weaken until experiencing their worst losses after the FOMC Announcement (Fed Rate Decision).  Although the FOMC Announcement these days is less about "finding out" what the Fed Funds Rate will be (since they've said it will be low through late 2014), they're still one of the most important market movers for Bond Markets, of which MBS (the Mortgage-Backed-Securities that most directly influence mortgage rates) are a part.  

So even though the Fed isn't moving their lending rate, markets still gather clues or direct information as to what their policy changes will be.  Some commentary has suggested that it was once again the ABSENCE of any hints of further quantitative easing that ultimately hurt rates today.  We're skeptical about such an easy answer and see the underlying cause as a sort of perfect storm of events.

Greece just got their bailout approved.  Overnight markets got much better than expected data out of Europe.  Retail Sales were slightly stronger than expected this morning and revised stronger in the previous month.  The FOMC Announcement used slightly more positive verbiage to refer to economic growth.  All of these things are economically positive, and what's good for the economy is generally bad for rates.  

Combine that with the fact that--for lack of a better way to describe it--the trading levels in bond markets were susceptible to this correction by the time this morning's weakness made it's way onto the charts and the post-FOMC weakness seemed almost like a natural move.  What we mean by this is that once fundamental forces in the market caused rates to move higher earlier in the day, there was sort of a logical amount of "room to run" to around 2.13 in 10yr yields. 

Granted, 10yr yields are not what mortgage rates are based on, but their movements tend to correlate much more frequently than they digress.  10yr weakness led the charge today, and mortgage rates followed, albeit in much gentler fashion.  

Rates are either on the verge of moving sharply higher, or they're soon to correct decidedly back into a 3.875% Best-Execution zone.  The frustrating part is that they might look like they're moving higher at first only to bounce back a few weeks later.  If you weren't already locked and have been waiting to do so, rates are STILL close enough to historic lows that floating doesn't make much sense tonight.  Given how close markets have been pushed to the edge of recent ranges, we'll have a much better sense of how the recent range is faring by tomorrow afternoon.

 Today's Mortgage Rates

30-year fixed-3.875% APR-3.924% 0 points

20 year fixed-3.625 APR-3.692% 0 points

15 year fixed-3.250% APR-3.333% 0 points

10 year fixed-3.00% APR-3.123% 0 points

5/1 ARM-2.625% APR-3.091% 0 points

7/1 ARM-2.875% APR-3.127% 0 points

FHA

30 year fixed-3.750% APR-4.659% 0 points

15 year fixed-2.875% APR-3.319% 0 points

Jumbo- over $576,000 (Fairfield County)

30 year fixed-4.000% APR 4.117% 0 points

15 year fixed-3.500% APR 3.574% 0 points

5/1 ARM-3.125% APR 3.419% 0 points

7/1 ARM-3.500% APR 3.818% 0 points

30-year fixed-3.875% APR-3.924% 0 points

20 year fixed-3.625 APR-3.692% 0 points

15 year fixed-3.250% APR-3.333% 0 points

10 year fixed-3.00% APR-3.123% 0 points

5/1 ARM-2.625% APR-3.091% 0 points

7/1 ARM-2.875% APR-3.127% 0 points

 

Pat Leary is  a mortgage banker with over 12 years experience as a lending specialist in Connecticut. Her passion is to guide her clients through the mortgage process. Pat takes pride on providing great customer service, through communication, trust and integrity, and strives to offer the best mortgage products and service in the industry. We're confident that you will receive the personal attention that you deserve. As a leading Mortgage Banker in Connecticut, Pat  is responsible for structuring your financing with the expertise to answer any questions you may have on rates, fees and products.

Pat Leary

NMLS #99279
Atlantic Home Loans
830 Post Road East

Westport CT 06880
203-645-1037 cell
203-691-9788 ext 226
1-203-413-5647 fax

Very Few Changes in Fairfield County Shadow Inventory

In late November of 2011, we analyzed the shadow inventory in Fairfield County, and saw that there were 10,229 properties that were currently "in-stage" or somewhere in the process of foreclosure.

As of this morning, that number is still very high. There are 9,957 properties looming in shadow inventory, and this figure is down only 2.7 percent countywide. In fact, there were four towns that have an increase  in properties that made the list. Interestingly enough, they are NOT cities and they also border one another. The towns with increased delinquencies are Easton, Monroe, Newtown and Redding.

If you are unfamiliar with the term "Shadow Inventory" it refers to the houses that will be on the market predominantly due to one of the following: they are pending foreclosure, homes that have already been foreclosed  and not yet sold, properties that are caught in the clogged foreclosure process, and lastly- and this is the uncertain number with no way to track, are homes that owners are delaying putting on the market until prices improve. Pending divorces, and estate properties where the homes will have to be sold are also not included in our list below.

  
Shadow inventory creates uncertainty about the best time to sell (for owners) and will dictate when a local market can expect full recovery.

None of this even takes into account the homes that were listed on the market and didn't sell during the listing contract, and those homes will also come back on the market at some point, too.

There are approximately 2.3 million houses for sale nationwide, and that represents a quite significant 20 percent decline from last year. We can look at that two ways- One -that the absorption rate has increased exponentially, and/or Two- homeowners are waiting to sell until prices get better. Either way, or any combination of both does signal good news for the market, as a glut of available properties for sale would only hurt prices further. However, the fact remains that the pending Shadow Inventory WILL put a damper on a timely real estate market recovery.

According to the GFC-CMLS, which may have up to a 30-60 day delay in reporting, there are currently  over 10,200 properties in distressed status in Fairfield County alone, while less than 800 are bank owned. That's an awfully large backlog of properties that is going to take some time to sell.

The hardest hit areas in the twenty three towns and cities in Fairfield County continues to be its four most populous communities. Bridgeport, Stamford, Norwalk and Danbury comprise over 6,200 or nearly 63 percent of the looming inventory, and while the total number is down by about 200 properties, the percentage of homes in these communities is not. The town of Stratford has also emerged this year with the 5th highest rate with 781 properties in stage, or bank owned.

Still troubling is that just under 800 properties are showing current ownership by banks or financial institutions, and that has increased by about 200 properties since late November. It appears that we have a long, long way to go before this gets corrected and the market can return to some state of normalcy.

The Fairfield County towns with the fewest foreclosures and amount of Shadow inventory in the wings are Sherman, *Easton, *Redding and Darien with a four town total of 228 properties either in some stage of foreclosure or bank owned.  NOTE:*Easton and *Redding are showing increased delinquencies over the past few months, but still have fewer properties on the list.

The fact that so many of these homes have not even hit the market yet is cause for concern over the next few years. Even though interest rates are still at all time lows, and credit  requirements have begun to loosen, albeit so minimal that it may not even be worth mentioning, the harsh reality is that these current conditions of the real estate market  are not leaving us anytime very soon, and unfortunately may, in fact get just a little worse before it gets better.

And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

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Let Your Realtor Know What Your Expectations Are

Far too often, there is miscommunication between agents and buyers or sellers, or between agents and other agents. All of this can be circumvented quite easily by having a conversation at the beginning of your professional relationship.

Everyone has a different opinion on the following:

1. A big house
2. A small house
3. A big yard
4. A small yard
5. How quickly one should return calls and/or emails- and that one is a biggie!

Let's take the following for an example as to how communications between you and your agent can make all the difference in the world.

Let's say that one of the most important things to you in finding your new home is having a big yard.  That really is an ambiguous term- "big". What is big to one person is small to another. Same thing goes for the yard. Coming from one of the boroughs in New York, a big yard may mean over one quarter of an acre, but a big yard to someone else can mean over one acre.

It's not your job as a buyer or seller to  explain these things. Your agent should ask, so that there is no misunderstandings.

Now, as to communication- My clients are very much accustomed to me getting back to them very quickly, and following up with them even if it is just to say, "I don't have any information yet- I just wanted to let  you know that you are in my thoughts", or "I haven't heard back from the sellers (or buyers), and hope to have an answer by 6PM tonight. I will call you either way."

Not everyone will call you to tell you they do not have information or an answer yet. Sorry, but attorney's are especially notorious for this. So are a lot of agents.

Communication goes a long way in keeping a transaction as smooth as possible from start to finish. Not everyone is so diligent in returning calls or emails, and instead of getting frustrated or upset, lay down the parameters when you first meet as to what your expectations are. Also understand that sometimes the agent that your agent is dealing with (and that you or your agent have no control over)  has a slower response time than you would like, or are accustomed to.

And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.