Protect Your Investment: A Homeowner’s Guide to Hiring Contractors in New Jersey
When it comes to home improvements, homeowners often find themselves excited yet apprehensive about hiring contractors. With the thrill of renovations comes the potential for pitfalls. Home repairs can be very costly, and when something goes wrong, it can quickly take a homeowner far out of their budgeted range for the renovation. Understanding the Home Improvement Practices Regulations and the New Jersey Consumer Fraud Act can safeguard your investment and ensure a smoother renovation process.
Home Improvement Practices Regulations
In New Jersey, the Home Improvement Practices Regulations set forth specific guidelines and requirements which contractors must follow. Here’s what you need to know:
1. Licensing Requirements: Contractors must be registered with the New Jersey Division of Consumer Affairs. The written contract must display the contractor’s registration number. You should always check the consumer affairs website to ensure the contractor’s license is active (see link in the comments). If the license is active, this means they also have insurance.
2. Written Contracts: For any home improvement work costing $500 or more, a written contract is mandatory. This contract must detail the scope of work, total costs, payment schedule, and the start and end date. Ensure you read the fine print and clarify any ambiguous terms before signing.
3. Right to Cancel: Homeowners have the right to cancel a contract within three business days of signing. This is crucial if you feel pressured into a decision or find the terms unsatisfactory.
4. Permits and Compliance: Contractors are responsible for obtaining necessary permits prior to beginning work, and complying with local building codes.
The New Jersey Consumer Fraud Act
The New Jersey Consumer Fraud Act (CFA) offers robust protections for consumers against deceptive business practices. Here’s how it intersects with home improvement contracts:
- False Advertising and Misrepresentation: If a contractor makes false claims about their qualifications or the services they offer, you can hold them accountable under the CFA.
- Unconscionable Practices: The term “unconscionable commercial practices” is broadly defined in New Jersey caselaw. If a contractor engages in unfair practices, such as significantly inflating costs, coercion, taking money which is not properly allocated to work, performing the work in a way that is not described in the contract and which causes some type of discrepancy between the final product and what was promised, failing to deliver on promises, and countless other practices that may be considered unconscionable, you may have grounds for a consumer fraud lawsuit.
- Damages and Remedies: Homeowners who bring a successful CFA lawsuit are entitled to triple damages (three times their actual ascertainable damages) and reimbursement of attorney’s fees.
What Homeowners Should Know Before Hiring a Contractor
1. Research and Referrals: Before hiring, do thorough research. Ask friends and family for recommendations, read online reviews, check the contractor’s history with the Better Business Bureau, and ensure that the contractor’s license is active.
2. Get Multiple Estimates: Always obtain at least three estimates. Request that each estimates breaks down the cost of labor and the cost of materials separately. This will give you a clearer picture of fair pricing and help you identify any suspiciously low bids.
3. Trust Your Instincts: If something feels off during your initial interactions, don’t hesitate to walk away. A good contractor should be transparent, communicative, and willing to answer your questions. As stated above, you are entitled to cancel a home improvement contract within 3 days of signing, with no loss.
Recent NJ Cases Highlighting Homeowner Rights
There are hundreds of NJ cases which help illustrate homeowner’s rights. Below are some facts from just a couple to provide an example:
- Case Example 1: A homeowner in NJ sued a contractor for failing to complete a kitchen renovation. The contractor had accepted a substantial deposit but left the job unfinished for months. The homeowner successfully argued under the CFA, resulting in a judgment that not only covered the remaining costs but also awarded triple damages and attorney’s fees.
- Case Example 2: A NJ homeowner was deceived by a contractor who promised high-quality materials but used substandard supplies instead. The homeowner took legal action under the Home Improvement Practices Regulations and the CFA, and was awarded triple damages for the difference in quality, as well as attorney’s fees, emphasizing the necessity for contractors to honor their claims.
Conclusion
Hiring a home improvement contractor in New Jersey requires due diligence and awareness of your rights as a consumer. By familiarizing yourself with the Home Improvement Practices Regulations and the New Jersey Consumer Fraud Act, you can protect yourself from potential fraud and ensure your renovation goes as smoothly as possible. Also, in the event that things go south, you will know how to protect yourself and your largest investment, your home. Remember, a well-informed homeowner is an empowered homeowner.
If you encounter any issues, don’t hesitate to reach out to legal professionals who can help navigate your rights and options. If you are having issues with your home improvement contractor, give RHG Law a call and I will be happy to discuss your options at no cost to you.