Scam: I don’t need to pull a permit

You’re legally required to get a building permit for any significant construction project. That allows building officials to visit the site periodically to confirm that the work meets safety codes. On small interior jobs, an unlicensed contractor may try to skirt the rule by telling you that authorities won’t notice. On large jobs that can’t be hidden, the contractor may try another strategy and ask you to apply for a homeowner’s permit–an option available for do-it-yourselfers. Taking out your own permit for a contractor job means lying to authorities about who’s doing the work, and it makes you responsible for monitoring all the inspections—since the contractor doesn’t answer to the inspector, you do.

Scam: We ran into unforeseen problems

The job is already underway, perhaps even complete, when this one hits. Suddenly your contractor informs you that the agreed-upon price has skyrocketed. He blames the discovery of structural problems—like a missing beam or termite damage—or design changes that you made after the job began. The additional fees might very well be legit, but some unscrupulous contractors bid jobs low to get the work and then find excuses to jack up the price later.

If you’re unsure whether your contractor is telling the truth about structural problems, you can get an impartial opinion from a home inspector, the local branch of the National Association of Home Builders, or even your local building department. Before signing any contract, make sure it includes a procedure for change orders—mini-contracts containing a work description and a fixed price—for anything that gets added to the job in progress. The extra work, whether it’s related to unforeseen building issues or homeowner whims, can proceed only after the change order is signed by both homeowner and contractor.