Bank Offers Tips To Homeowners To Avoid Post-Hurricane Scams

STATE — As many New Jersey residents begin to restore and rebuild their homes in the wake of recent storms, Provident Bank is urging residents to be wary of phony contractors who might take advantage of homeowners in distress.

While seeking contractors to make home improvements, consumers should be cautious about instant estimates, door-to-door salesmen and cash only or pay-up-front offers. In particular, “easy financing” offers could be red flags for home equity fraud.

“While it may be tempting to forego the normal formalities and standard procedures in the interest of time, consumers must be aware of the red flags to avoid being scammed by unlicensed contractors,” said Barbara Carrollo-Loeffler, Provident’s director of residential and consumer lending.

Provident offers the following tips to help residents avoid contractor fraud:

  1. Know who you are working with. Before hiring any post-disaster contractor, ask your insurance company to survey the damage and inquire about licensed contractors. Consumers can verify if someone is a registered contractor in New Jersey by calling the Division of Consumer Affairs or visiting If a contractor is new to you, be sure to ask for references and check them out.
  2. Be prepared. Research how much the work typically costs. Don’t take a contractor’s word on how much your insurance company or flood insurance will pay – an insurance adjuster will make that determination after assessing the damage. Be wary of a contractor who disputes what an adjuster recommends and then offers a short cut or to split the difference in cost with you. Make sure your insurance information is easily accessible for your reference.
  3. Don’t disclose your financial information. Personal financial information should not be shared with a contractor or lender until you are able to verify they are legitimate. In an attempt to steal equity in a home, a phony contractor may steer you towards a particular lender and recommend loans with very high interest rates and other fees.
  4. Never pay 100 percent upfront. Deposits or upfront fees should not exceed 25 percent of the estimate. Pay contractors by check only after materials reach your home and work begins. Reserve one final payment for when work is fully completed so you have some recourse. Keep in mind, New Jersey residents have 72 hours to cancel a contract. You also should familiarize yourself with how to stop payment of a check from your bank just in case
  5. Get everything in writing. Be sure to get estimates, materials, prices and completion dates in writing. This information, along with a copy of the contractor’s license, should be shared with your insurer before you sign anything.
  6. Remember: insurance fraud is illegal. If you suspect fraudulent activity, report it by calling the National Center for Disaster Fraud’s (NCDF) hotline at: 1-866-720-5721.

More information about Provident is available at

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