15 Contractor Red Flags That Should Make You Run
These warning signs indicate a contractor who might disappear with your money, deliver shoddy work, or leave your project unfinished.
Contractor scams cost American homeowners billions of dollars every year. And it's not just obvious scams — many homeowners get burned by contractors who seem legitimate at first but reveal their true colors once work begins.
The good news? Most problem contractors display warning signs early. Learn to recognize these red flags, and you can avoid most contractor nightmares before they start.
Important
One red flag might be explainable. Two or more red flags together should be an automatic disqualification. Trust your instincts — if something feels wrong, it probably is.
Demands Large Upfront Payment
Asking for more than 30% upfront — or the full amount before starting — is one of the biggest scam indicators.
The Reality: Legitimate contractors have accounts with suppliers. They don't need your money to buy materials. A large upfront payment often disappears with the contractor.
What to do: Offer 10-20% deposit max. Structure payments around completed milestones.
Cash-Only or "Discount for Cash"
Insisting on cash payments or offering suspiciously large discounts for paying cash.
The Reality: This is often tax evasion, but more importantly, cash leaves no paper trail. If something goes wrong, you have no proof of payment.
What to do: Always pay by check or card. Get receipts for everything.
No Physical Business Address
Only a P.O. box, or no address at all. They "work out of their truck."
The Reality: Fly-by-night contractors are hard to track down when problems arise. No physical presence often means no accountability.
What to do: Verify they have a real office or at least a consistent, verifiable home base.
Pressures You to Decide Now
"This price is only good today" or "I have another client interested" pressure tactics.
The Reality: Legitimate contractors are busy because they're good — they don't need high-pressure sales tactics. This urgency is designed to prevent you from doing research.
What to do: Any contractor who won't give you time to think isn't worth hiring.
Shows Up Uninvited
Door-to-door solicitation, especially after storms or disasters.
The Reality: Storm chasers are notorious for taking deposits and doing poor work (or no work). They're often gone before you realize there's a problem.
What to do: Never hire a contractor who solicits door-to-door. Find your own through research.
No Written Contract
Wants to work on a handshake or provides only a vague, one-page "agreement."
The Reality: Without a detailed contract, you have no legal protection. The contractor can change scope, price, and timeline at will.
What to do: Require a detailed written contract covering scope, materials, timeline, payment terms, and warranties.
Can't Provide References
Excuses like "I respect my clients' privacy" or only provides email addresses.
The Reality: Happy customers are usually willing to share their experience. A contractor with no verifiable references likely has unhappy ones.
What to do: Require phone numbers for recent references and actually call them.
License or Insurance "In the Truck"
Can never produce documentation on the spot and promises to "bring it tomorrow."
The Reality: Tomorrow never comes. Contractors who can't immediately prove licensing and insurance likely don't have them.
What to do: Get documentation before any work begins. Verify it independently.
Significantly Cheaper Than Everyone Else
A bid that's 30-50% lower than other quotes for the same work.
The Reality: They're either cutting corners, using cheap materials, planning to hit you with change orders, or planning to abandon the job.
What to do: If a price seems too good to be true, it is. Understand why there's such a difference.
Vague or Missing Details in Estimate
A single line item like "Kitchen remodel - $25,000" with no breakdown.
The Reality: This gives the contractor room to claim anything not specifically listed is "extra." You'll get nickeled and dimed throughout the project.
What to do: Require itemized estimates listing labor, materials, brands, and quantities.
Wants to Skip Permits
"We don't need a permit for this" or "I'll give you a discount if we skip the permit."
The Reality: Unpermitted work can affect your insurance, create liability issues, and cause major problems when you sell. It may also hide substandard work.
What to do: Permits are non-negotiable for major work. The contractor should pull them.
Unmarked Vehicle, No Signage
Shows up in a personal vehicle with no company identification.
The Reality: Established contractors invest in their business identity. Those operating "under the radar" may be avoiding accountability.
What to do: Look for professional presentation as one indicator of legitimacy.
Pushes Specific Materials or Suppliers
Insists you must use their materials supplier or a specific brand without good reason.
The Reality: Could indicate kickbacks, inferior materials, or a scheme to inflate material costs.
What to do: Ask why. Get alternative quotes. Research the recommended materials independently.
Won't Put Changes in Writing
Verbal agreements for scope changes or additional work without documentation.
The Reality: Without written change orders, disputes are impossible to resolve. You may end up paying for work you didn't authorize.
What to do: Every change, no matter how small, should be documented and signed before work proceeds.
Bad Communication From the Start
Doesn't return calls, arrives late to estimates, or is hard to get ahold of.
The Reality: How they act before they have your money is the BEST you'll be treated. It only gets worse after they start.
What to do: Communication problems during the sales phase guarantee problems during the project.
Real Indianapolis Contractor Horror Stories
"He took $8,000 for a bathroom remodel, demoed everything, then disappeared. I was without a working bathroom for 3 months while trying to track him down."
— Homeowner, Carmel
"The roof looked fine for a month. Then the first heavy rain came and we had leaks everywhere. Turns out he used the wrong materials and no underlayment."
— Homeowner, Fishers
"The $15,000 quote became $35,000 in 'necessary change orders.' By then he had us over a barrel — our kitchen was torn apart."
— Homeowner, Indianapolis
* These stories are representative of common contractor complaints in the Indianapolis area.
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Even careful homeowners miss red flags. Scam contractors are professionals at seeming legitimate — it's literally their job to fool you.
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