Top 5 Roofing Scams: Protect Yourself and Your Money

June 12, 2015
The roof is one of the single most important components of any home. No part plays a bigger role in keeping the elements out, so when a roof requires repair, there’s little time to waste.
The desire to have a roof quickly replaced and the fact that most people have little experience working with a roofing contractor can set an unsuspecting homeowner up for a variety of scams.
Fraudulent roofing contractors prey on vulnerable homeowners and have become increasingly bold in their tactics.
From unlicensed storm chasers to mysterious door-to-door salesman, there are many ways to fall victim to roofing scams.
In our experience, these are the most common scams, and how to avoid being taken advantage of. Here are some to watch out for:

1) The Storm Chaser

Out of all the roofing scammers, the out-of-town storm chasers are the most publicized, yet people all across the country fall victim to them. Also known as roofing gypsies, these roofers travel around the country following the paths of storms looking for homeowners to exploit.
“The Weather Bureau will say which areas have hail or wind damage,” says Ashley Morgan, co-owner of highly rated The Happy Roof Company in St. Louis. “The chasers pay attention to those readings and they know the insurance companies will allow for roof replacement in those areas.”
The way the scam works is the storm chasers will blanket an area hit by hail or wind damage and look for unsuspecting homeowners. They’ll pass out leaflets and even show up unannounced or offer a free inspection.
The St. Louis roofer says the chasers know how the insurance companies work, and based on the square footage of the roof, they can figure out how much it will cost to put on a cheap new roof. The homeowner gets burned because the storm chaser only does the bare minimum to replace the roof, but doesn’t address any other problems, or restore the roof to its original condition.
The homeowner is then left with a poorly constructed roof and the fraudulent company that was once so ready to help has vanished.
“When a roof is put on by a storm chaser, normally those roofs only last 5 to 7 years and then I have to tell the homeowner their roof needs to be replaced,” Morgan says.
The storm chasers have no incentive to produce high quality work, and there’s really no way for them to be held accountable because they will be gone by the time a problem arises.
Aside from the shoddy work, many of the storm chasers lack a valid license, don’t hold insurance or will lie about having insurance.
The best way to avoid the storm chaser is to do your own research. Ask to see proof of insurance and check the roofer’s license status with your local building department or licensing agency. You should also pay a visit to the roofer’s office. If the company only lists a post office box, it’s a major red flag. It’s also smart to ask for a list of previous customers in your area, and you should visit the work sites to make sure the references are legit.

2) High-pressure tactics

One all-too-common roofing scam involves a contractor who will show up to a scheduled consultation, or unannounced in a neighborhood where other homes are having roofing work done. Promising a special deal or exceptionally low rate, the contractor will pressure the homeowner to sign a contract on the spot. If the homeowner puts up any kind of resistance to the sales pitch, the contractor will make dishonest claims or mislead the homeowner to enter a legally binding contract.
Donnie Kitterman, of The Happy Roof in St. Louis says the high-pressure approach happens all the time in the roofing industry. “A roof is only done once or twice in a person’s lifetime so it’s easy to fall victim because there is no point of reference or very little experience in making such a large purchase,” he says.
Kitterman says the reason roofing companies revert to high-pressure tactics is because they typically charge a higher rate and want to get the homeowner to sign a contract and pay a down payment without consulting other companies.
“They want to get the homeowner into a legally binding contract before they’ve gotten other bids, and because nobody wants to get involved in a legal battle unless absolutely necessary, it’s usually too late if other estimates come in after the homeowner has already signed up with these dishonest companies,” he says.
Kitterman’s tips for avoiding high pressure roofing contractors.
  • Do not agree to give a down payment on a roofing project before the material is delivered. And, never agree to a down payment greater than 35% of the total sale price. “A reputable contractor will never ask for more than 35% of the projects cost upfront.”
  • It is always good to have all decision makers together but it’s not a requirement. If the roofer insists on “both decision makers” be present for the presentation, beware of this tactic, it’s a sign the roofer isn’t confident in his pricing and wants to pressure you into signing a contract before you take the time to make an educated decision.
  • In all fairness, if a professional takes the time to prepare a proposal, he/she should be afforded the opportunity to present the proposal. Don’t be afraid to ask if he/she would be okay with emailing the proposal and discussing it over the phone.

3) Unidentified door-to-door salesman

One of the biggest scams in the roofing industryinvolves the unidentified door-to-door salesman who shows up unannounced with the promise of a free roof.
“I have seen and heard so many stories from customers and friends of mine who have been approached or scammed by the door-to-door sales guy that I have lost count,” says Donnie Kitterman, co-owner of highly rated The Happy Roof Company in Saint Charles, MO. “These salesmen are trained to sell, and sell hard. They don’t just target senior citizens, every homeowner is fair game.”
These scammers will target neighborhoods with a large number of senior citizens, older homes or where a major storm has hit.
Under the disguise of a free roof inspection, the scammer will go up on the roof and fabricate damage to mimic storm damage, or present a photo showing roof damage from a different home and claim it came from the homeowner’s roof. McHugh says he’s heard of salesman tearing off shingles to simulate wind damage, or hitting the roof with an instrument such as a ball-peen hammer to fabricate hail strikes.
Kitterman says this negatively affects homeowners in several ways. “Without the fabricated damage the homeowner would have no need to replace the existing roof, or get the full remaining value out of the roof,” he says. “Not to mention that filing a claim goes on your insurance record and could possibly affect future claims or even prompt the insurance company to not renew your coverage, forcing the homeowner to get a new policy from a new carrier.”
Legitimate door-to-door salesman are company are truly representatives of their company. They should be prepared to show credentials upon request and should be easily identifiable by a shirt/uniform, name badge, and clearly marked vehicle.
Having a true professional goingdoor-to-door is a great opportunity for homeowners toask a questions or bring up any concerns about your property. However, be cautious and don’t be afraid to ask for credentials such as insurance and/or business license.
It is also important to note, DO NOT sign any paperwork until your insurance company has inspected the roof. He also recommends investigating the company’s background, visiting its office and interviewing previous clients. “Some door-to-door companies are honest and will do the job professionally,” he says, but homeowners need to exercise extra vigilance.

4) The disappearing down payment

A common roofing scam occurs when a company agrees to replace a roof, but requires a down payment before starting the work. The company will say it needs the down payment to buy materials or to pay for labor, but it never returns once the check is in hand.
In most cases, the company will convince the homeowner to sign over or cash an insurance check as a down payment and then disappear.
Larry Morgan, of The Happy Roof Company, a highly rated roofing company, says the scam happens all the time.
“It typically happens to homeowners who have the home paid for because the checks are often made out to the homeowner and the mortgage company,” Morgan says. The scammers target these people because it often takes a long time for the mortgage company to release the funds.
However, the scam is still common for people who are still financing their homes. “A big scam that we see is even if the home does have a mortgage on it and the insurance check is made out to homeowner and mortgagee, the roofer will forge an endorsement stamp on the back so they can deposit it,” Tulp says. “It’s a major crime.”
The St. Louis roofer says that when a homeowner files a claim with his or her insurance company, the company sends out an adjuster to take note of the damage. The insurance company then issues a check for less than the total replacement cost. The homeowner is supposed to use the funds as an initial payment. Once the contractor completes the job, the bill is sent to the insurance company to pay the remaining balance.
“When you have contractors taking advantage of homeowners, it’s typically that first check that they take and disappear,” Morgan says.
Both Morgan and the BBB agree, you should never pay a down payment to a roofing company until supplies have been delivered.
“The safest way to guarantee that you never get ripped off is to not do business with somebody who won’t start your project or at least drop materials without a down payment,” Morgan says. “If you don’t give them any money, you can’t be taken advantage of.”

5) The fluctuating bid

In a roofing scam sometimes referred to as the “elevator ride,” a contractor will offer a low bid that is far less than other companies in the area. The contractor knows the homeowner doesn’t have a lot of experience dealing with a roof replacement and since it’s an expensive job to begin with, the homeowner jumps at the low bid.
Once the job begins, unexpected costs and unforeseen problems suddenly appear. The contractor might claim an increase in the cost of materials, or find damage that wasn’t addressed when the contract was agreed upon. In some instances, the contractor will literally remove the old roof and threaten to leave if additional payments aren’t made.
By the time the job is finished, it ends up costing substantially more than what was initially agreed upon.
Larry Morgan, Co-owner of The Happy Roof Company, in Saint Louis, says material prices do change in the roofing industry, but it’s a major red flag if a contractor tries to increase the price mid-project.
“Materials do go up all the time but every reputable contractor gets notices from the manufacturer weeks before the price goes up,” Morgan says. “The price of materials going up is not the homeowner’s responsibility to pay.”
Morgan says the one area of the roof that can’t be examined prior to starting a job is the roof’s decking, which is essentially the bottom layer or foundation of the roof where everything else is laid.
The Saint Louis Roofer says most legitimate roofing companies will include a section in their contracts that explains how any damage to a roof’s decking will be addressed and how much it will cost to replace per square foot. Morgan says most companies charge around $3.50 per square foot to replace damaged decking.
To prevent a situation like this from occurring, Morgan says a roofing contract must contain a section that lists the total cost of labor plus materials, as well as how the contractor will handle damage to the roof’s decking.

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