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• 02/07/2002

CSLB Press Release - 02/07/2002

Contractors Board Reminds Consumers of Their Rights When Dealing with Contractors

SACRAMENTO — In recognition of National Consumer Protection Week (Feb. 3-9, 2002), the Contractors State License Board (CSLB) reminds consumers of their rights and responsibilities when hiring building contractors. The CSLB has found that the most common complaints against contractors can be avoided when consumers:

• do not pay excessive down payments to contractors
• do not let payments on home improvement projects get ahead of the work
• hire only licensed building contractors
• check out the contractor's license status and history with the CSLB.

A recent CSLB undercover operation underscored the risk to consumers. Unlicensed contractors who asked for excessive down payments were caught in a sting conducted by the CSLB on February 6, 2002. Ten unlicensed contractors were cited for illegal advertising and contracting without a license.

The CSLB invited suspected unlicensed contractors to a secret sting house in Sacramento. When they bid on jobs -- ranging from kitchen remodeling, drywall and painting to landscaping and concrete work -- and were found to be unlicensed, they were issued a Notice to Appear in Municipal Court. By law, all contractors who perform work that totals $500 or more (labor and materials) must be licensed by the CSLB. Half of the contractors asked for excessive down payments. For instance, one contractor asked for 50 percent down for materials on a fencing project.

A recent statewide survey revealed that a majority of homeowners do not know that by law a contractor cannot ask for more than 10 percent or $1,000, whichever is less, as a down payment. For example, if a bathroom remodel costs $5,000, by law, the down payment cannot be more than $500.

Consumers also need to be aware that they have the right to negotiate a clear home improvement contract that includes the cost of the project, the project down payment, a payment schedule, and a completion date.

These financial elements protect consumers in a number of important ways: the total cost of the project (labor and materials) is clearly stated, which eliminates any misunderstandings about the final price, and a lawful down payment and payment schedule ensures that consumers do not pay for work or materials that have not been completed or delivered.

The CSLB urges all consumers to order free publications and check contractors' licenses online at www.cslb.ca.gov or toll-free at (800) 321-CSLB.

The CSLB, which operates under the umbrella of the California Department of Consumer Affairs, licenses 278,000 contractors in California and investigates 25,000 complaints against licensed and unlicensed contractors every year.