Foundation contractor red flags, and how to verify a company before you sign

The biggest warning signs are pressure, vagueness and money up front. Look out for a same-day “discount” that expires, a proposal with no diagnosis or pier count, a warranty you can’t see, a large cash deposit, or a request that you pull the permit. Verification depends on your state and city: Nebraska and Iowa require contractor registration, Arkansas generally requires an appropriate residential license for qualifying work above $2,000, Oklahoma has no state general-contractor license, and Kansas and Missouri leave licensing to cities and counties. Check the authority that covers your address.

Warning signs in the sale

The FTC’s guidance on avoiding home-improvement scams lists several red flags that apply directly to foundation work:

• Uninvited contact, often door-to-door after a storm or flood, with materials “left over from another job.”
• Pressure to decide now. A legitimate structural diagnosis doesn’t expire tonight.
• Cash only, or a large payment before work starts. Some states cap down payments. The FTC advises not paying the full amount up front.
• Asking you to get the permit. That can put responsibility for the work on you.
• Steering you to a particular lender.

Specific to foundations, add these:

• No cause, just a product. “You need 14 piers” without an explanation of why the house moved, or what will stop it moving again.
• No numbers. No elevation readings, crack measurements, wall-deflection measurements or drawing.
• A warranty you can only hear about. If they won’t give you the document, you can’t compare it. See Foundation repair warranties.
• “Engineered” without an engineer. Ask who the engineer is, whether they visited, and whether you get a stamped letter or drawing.
• Fear framing. Statements that the house is unsafe or will “collapse.” If you’re genuinely worried about safety, call an independent structural engineer or your building department, not the salesperson.

Your right to cancel some home sales

Under the FTC’s Cooling-Off Rule, a sale of $25 or more made at your home generally can be cancelled until midnight of the third business day after you sign. Sales of $130 or more at certain other temporary locations are also covered. There is an exception for genuine emergencies that you initiated, which requires a separate handwritten waiver. Kansas has a similar door-to-door sales cancellation right. Missouri’s statute applies to consumer credit sales solicited at home and doesn’t count Saturdays as business days. The exact rules depend on how and where you signed, so read the cancellation notice the seller must give you.

What each state requires

Contractor rules in our six states differ a lot. A state registration is not a measure of skill, and none of these programs certifies foundation workmanship.

City requirements sit on top of these. For Kansas City-area specifics, see Foundation repair permits and contractor checks in Kansas City. For other metros, see Foundation repair permits and licensing.

Five checks you can do yourself

1. Match the legal name. The company name on the contract should match the license or registration record, the insurance certificate and the warranty. A DBA that matches nothing is a question to ask.
2. Check the local record. Use the city or county register for your address, and the state registration where one exists (Nebraska, Iowa, Arkansas). Note the class and expiration date. Expired or inactive is a finding, but a missing online record isn’t proof the company is unlicensed. Ask the issuing office.
3. Ask for insurance certificates sent directly from the insurer, and confirm them. The Nebraska Attorney General’s checklist suggests verifying insurance claims with the insurer.
4. Read the warranty document before signing, and check who issues it.
5. Confirm the permit plan in writing: who applies, who pays and who schedules inspections. Oklahoma’s CIB suggests asking to see the permit before work starts.

On each company’s record we show the credential checks we could complete, with the authority and date. A blank or “not checked” field means our check couldn’t be completed. It doesn’t mean the company lacks the credential.

Paying safely

• Keep the deposit modest. Iowa’s and Nebraska’s attorneys general both advise against paying in full before the work is done.
• Tie payments to milestones, such as materials delivered, piers installed and the final inspection passed.
• Get lien waivers. In Missouri, the original contractor generally must give the owner a statutory “Notice to Owner” before receiving payment. It warns that failure to get lien waivers “may result in your paying for labor and material twice.” In Kansas, subcontractors and suppliers on residential jobs must send owners a statutory warning before relying on a lien in many cases. Ask for waivers from the contractor and major suppliers as you pay. Iowa’s attorney general also suggests checking for liens before final payment.
• Put every change in writing. Arkansas’s attorney general advises requiring written approval of any change in price or scope.

Where to report a problem

Your state attorney general’s consumer protection office takes complaints about home-repair fraud: Kansas, Missouri, Oklahoma, Nebraska, Iowa and Arkansas each run one. Report suspected permit violations to the city or county building department.