Foundation Repair Scams
THE MULTIPLE NAME GAME
In this scam, one foundation contractor has many large ads in the yellow pages, all with different names, different phone numbers, and different addresses. In this way, you may obtain different estimates to compare prices, totally unaware that they are all from the same entity, all owned by the same person, and usually generated from the same location, using the same crews and the same offices.
In one case, the very large national foundation repair contractor uses one address on one street, and another company name uses an address on the back street, with the same inventory and establishment in the middle.
One foundation contractor has been known to use as many as 5 different, distinct names at the same time, without any notice that they are connected, while supplying different phone numbers with each name.
One client recently had hired one company, and when the work was finished, the company gave her a warranty with a different company name. They had forgotten which company name was doing the work!!!
This has been found to be common with many fence companies, garage door companies, and roofing companies as well.
It may be difficult to offer a questionnaire to the foundation repair contractor, and make them sign it, but you need to know if they are connected in any way, manner, or form to any other foundation contractor whatsoever. You want comparable price quotes, and you want them from distinct, totally separate entities, from owners who are not related or connected. Get a drivers license number and verify an address before the contractor is hired.
This should be against the law!!!
THE NAME CHANGE GAME
In this game, a foundation contractor changes names often. Many of them are using several names at the same time, and many others just change names once the business gets bad, so they start over under another name. In this way, no warranties have to be honored, lawsuit papers cannot be delivered, and upset clients cannot find them. Also, the foundation contractor may offer any warranties, wild claims, and outrageous claims of work performance anytime he wishes, because he won’t be around to back it up.
It is probably not against the law for someone to mismanage their business and go on to another name and start again, but if a client requests the information, the contractor should be honest about all the previous names used.
One foundation contractor was known to have 5 different company names in 4 years, left town for a couple of years, came back to town using a different name, and then returned to using one of the original names again, and over 5 years used 3 more names.
Many companies will omit their address in order to avoid contact with the client.
It may be hard to expect a dishonest contractor to be honest with you, and give you all previous names used. It may be useful to contact your local Better Business Bureau to back up some of their background, but the BBB does not usually have the previous names. Once a contractor receives too many BBB complaints, they shut down and start using another name, ignoring all the complaints.
You may require driver’s license information and a legitimate address to rest your fears.
WE’VE GOT INSURANCE GAME
Most foundation repair companies do not have insurance. Legitimate workers compensation insurance rates are set by the State of Texas, and they are high. They should cover all workers working on the site, but so many foundation repair contractors do not have employee status, so they do not pay workers compensation on them. They are listed illegally as independent contractors, so they are not covered.
You may see a workers compensation certificate, but it may not really cover the workers that could actually get hurt on your property.
In years past, as Bedrock attempted to obtain insurance, a competitors insurance certificate was obtained, and Bedrock attempted to obtain insurance from the same insurance company. After many attempts, they declined us because they said they were not offering that kind of insurance any longer. What we discovered later was that the insurance company was owned by the foundation repair contractor.
In another competitive case, after obtaining the insurance name by the competitor, when we called, we found the insurance company only offered life insurance.
One neighbor was hiring a competitor, and I warned the neighbor, who was an attorney, that the competitors insurance was a fake. He really had no insurance. The neighbor attorney was a bit miffed by my outrageous claim, so he investigated further.
After many attempts to obtain the insurance certificate, the competitor finally gave him the name of his insurance company, Phoenix Insurance out of Phoenix, Arizona. The neighbor found that there was no such company. When he contacted the competitor about it, the competitor backed out of the job and cancelled the contract.
Many foundation repair companies may have legitimate insurance, but get the certificate and verify it yourself, in detail. When you see INSURED FOR YOUR PROTECTION, you want to see the certificate and see exactly what the limits of that protection may be.
A new company buys an older company that claims it has been in business 30 years. No employees or workers are transferred in the sale, so all the new company really has is the name, and the claim to 30 years experience. Clients believe they are experienced and talented, but in reality there are no experienced workers at the jobsite or within the organization.
One worker worked for us 6 months, then went into business for himself, claiming 20 years experience.
Bedrock added up all its workers experience in the foundation leveling industry, added them together, and we have about 700 years combined service experience. No other can make that claim.
Challenge the foundation contractor and insist they show proof of being in business when they claim they were.
THE SUBCONTRACTOR GAME
When you hire a foundation contractor, and you’re relying what you believe they have is a good reputation, but wouldn’t you be deflated to find out that they didn’t perform any work on your property at all, but subbed it out to a stranger?
Recent research by Bedrock found that most companies deal with subs to do most of their work, and very little of it is done with in house employees. In this way the contractor avoids payroll taxes, overtime, and unemployment claims.
Fine, but you receive a stranger performing work inside your home, around your family, that is not drug tested, time tested, or has been checked out for criminal history, allowing many street corner helpers and the like into your home.
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, or their invitation to work there should be cancelled.
THE FHA/VA APPROVED GAME
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.
FHA and VA approved loans sometimes require an engineer to inspect the property, and they have specific requirements how that work should be performed, but no company has a blanket approval of all jobs and contracts approved by FHA or VA. It’s a scam.
THE CHEAPEST PRICE SCAM
As a consumer, of course you are looking for the cheapest price for the most work. Everyone does, but remember that you get what you pay for. The price may be lower, but is the foundation contractor placing fewer piers? Is the contractor eliminating necessary steps, such as filling the void under the slab (pressure grouting)?
One scam involves the push piling system. 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— driving the piles down to a point of refusal.
Hire reputable contractors that have a long history, to insure they will stick around to honor their warranty.
First of all, for most jobs under $10,000, you would want a contractor that is stable and financially secure enough to do your job without financial help the first day. For jobs over $10,000, some form of payments can be made after substantial and major work is first completed.
If you make the mistake of giving money up front, this is what can happen:
If you are unhappy with the work, you cannot fire the contractor, you must keep the contractor on the job so you can try and get your money back. His work could be extremely substandard, and yet he has you captured because you gave him so much money up front. If the contractor subs out the work to an undesirable group of workers, again you are stuck. You cannot fire the contractor because he has so much of your money already.
Perhaps the contractor or his subs appear intoxicated, and you wish they were not on your property. If you remove them, they may not return to finish the job, and you’ve lost your down payment money. Perhaps the city inspector finds them working without a permit, and they cannot or will not obtain a permit to finish the work. Again, you will lose your down payment. The contractor may even ask for more money, after the down payment, putting you in a position to give more and more, like extortion, or he can’t finish your job unless you do.
Don’t give any contractor a down payment. If partial payments are required on large jobs, pay partial payments after an engineer or inspector advises you that a great portion of the work has been inspected and completed.
WHERE ARE YOU LOCATED GAME
Many companies avoid listing their address in the yellow pages or in their contracts. They don’t want to find them in case there are problems later. Some foundation contractors rely solely on an answering service to collect their calls, and the answering service will not assist you in locating the contractor. At this point, you don’t even have an address to have the contractor served with legal papers. Ask yourself, where is this contractor located in case I need to find him later, and how long has he been at that location? How can I verify that? Does the contractor rely on an answering service or simply an answering machine for you to communicate? Be wary of the contractor who has only a cell phone, and not a land line and a solid address.
THE BRICK PIER AND BEAM SCAM
Brick pier and beam houses have a unique design that requires additional work over and above the standard concrete slab foundation leveling job. The perimeter of the brick pier and beam is a continuous concrete beam, running around the house. On top of this concrete beam lies the framing of the house on the inside, and the brick, or stone, on the outside. Under the concrete beam in almost all homes are some deep drilled piers. These concrete piers almost always have steel reinforcement that protrudes into the concrete beam.
In order for one to lift the concrete beam, the piers underneath it must be severed and separated from it. If not, the high pressure of the hydraulic lifting jacks will crush the concrete beam into pieces, because the pier will not pull out of the ground. The skin friction around it holds it in the ground. In some cases the pier can be sucked up out of the ground, but these cases are rare.
Where is the foundation repair scam? The contractor will install piers, but will not break the existing piers under the grade beam, and will not level the house. The house remains unlevel, and the contractor will usually point out that there is nothing in the contract that says they will level the house. YOU HAVE BEEN SCAMMED. You don’t have a level foundation, and you wouldn’t have hired them in the first place had you known that they would not level it.
Read your contract carefully, insuring yourself that the foundation repair contractor will actually raise the foundation to a reasonably level position. Most foundations cannot be raised perfectly, but reasonably close is quite fine. Make sure that the existing piers under the perimeter concrete beam are being severed so that the house can be raised. Hiring your own engineer to inspect the jobsite as the work is performed can save you a lot of money.
THE LIFETIME WARRANTY GAME
Many foundation repair companies have started offering a lifetime warranty. In the 1980’s the standard warranty on a foundation repair job was about 3 years. Bedrock started offering a 5 year warranty. Then the 10 year warranty was introduced, but the client usually did not know that the free adjustment period of this warranty was only 1 year, and the remaining 9 years was an additional cost to the homeowner.
Then the lifetime warranty emerged. Many different lifetime warranties were offered by many different foundation repair companies.
Some of the lifetime warranties covered only the materials on the job. They offered no free adjustments. Some lifetime warranties were lifetime alright, but you had to pay them for the adjustments to the foundation. Other lifetime warranties were indeed the lifetime of the home, but be wary of wild and speculative warranties from any product. The lifetime of the home could easily be a couple of hundred years, so do you really truly expect them to be there waiting when you call?
Ask yourself this question:
Should I have a problem with the foundation 60 years from now, do I expect them to be around in case I should call? Keep in mind that 90% of the foundation repair companies in the Dallas/Fort Worth area were not in business 15 years ago. Let’s hope your lifetime is longer than that.
Many of the companies have changed names so many times that no one knows who they are, and each time they change names, they throw away all those lifetime warranties.
Hire a foundation repair contractor with a long term history that you can verify. Be wary of lifetime warranties, but get a warranty with a reputable company you know will back it up.
DON’T PLAY THE SUBS GAME
Since the beginning of time, contractors have been hiring other contractors to do some of the work, and then not paying the other contractor, called the subcontractor. The general contractor runs off with all the money. The subcontractor can then file a lien on the homeowner’s property, and can possibly force the sale of the property to retrieve his money.
Require the foundation contractor to perform the repairs with in-house personnel only. Require the foundation contractor to employ only full-time employees, and not use any independent contractors or subcontractors.
Hiring a foundation contractor with a long term history is still the best solution, for even if the contractor did not pay for his materials, such as concrete, or any of his full time laborers, any of them can still file a lien on the property, and can probably force the homeowner to pay them their money.
You want to insure they really do go to rock, and you will not have to pay a dime if they don’t. Then you want to inspect the job as it is being done to insure the contractor goes to rock, and penetrates the soft surface rock until it reaches hard rock. Going into the rock is probably the most permanent foundation available, if it is truly into hard rock, and if the homeowner can afford.
Many contractors will play a game with words and claim to go to rock, or to refusal, whichever comes first. Well, the refusal is first, and they never go to rock unless it’s right at the surface. Beware of outrageous claim of performance.
Bedrock’s exclusive TORPEDO PIER can place a steel pier as deep as 90 feet deep with limited access.
THE NO PRESSURE GROUTING GAME
Want the cheapest estimate? Beware that raising a slab, especially over 2 inches, that it leaves a void, and that water can follow that void and pond under the slab, causing severe foundation problems. Many companies leave out the pressure grouting, which fills the void, and therefore have a cheaper estimate. Insist that if your slab is raised over 2 inches, that it must have the void filled through pressure grouting.
YOU HAVE A WATER LEAK GAME
Many foundation contractors open up immediately claiming your home must have a water leak. Many of these companies actually own the water leak company, and their company can find a leak even if they have to make one. Also, then they can try to get your insurance company to pay for the damages done by the leak. One way or another, they’re interested in at least getting a water leak repair job, under the slab, which can run thousands of dollars.
If your home has a leak, the foundation repair company pier holes will fill up with water.
If there is no ponding water in their holes, there is probably no leak at all, but any small leak is probably not enough to cause the foundation to settle if it does not accumulate overnight in the pier holes.
Also, a plumbing test is usually about $300 by a licensed plumber, and do not hire anyone the foundation company recommends to insure no conflicts of interest.
BAD LUMBER GAME
It has been known for a foundation contractor to claim bad lumber under a pier and beam home, when there is in fact no bad lumber at all. You want to see the bad lumber that is taken out, and you want to see the new lumber going in.
Better than that, in this new age of technology and advanced foundation repairs, request digital photos of the bad lumber, and then new photos of the new lumber installed.