Taking Legal Action on a Contractor

[Kiara Walters]

I recently purchased a duplex in Washington, DC with a FHA 203K loan. I started out with a contractor who was licensed in MD but his partner was licensed DC so his partner was the lead on paper. He was a recommendation from the real estate agency that I worked with. Unfortunately, after the first check was cut and I put the check in the contractors hand he did only a little work on a project that was estimated to take 4 weeks but after that time doubled (he kept giving personal excuses) I realized that something was very wrong and locked the property up so that he could not gain access. Also the licensed contractor went to the 203K office to back out of the deal but no one from that office felt led to reach out to me and let me know. After going to the FHA 203K team at my mortgage company, at first they threatened him to return the check and that he would be paid for the services rendered or THEY would press charges for fraud and grand larceny and he would have to answer to the attorney general in court. He of course never showed up with the check (about $18K) and then another person from the same 203K office told me that I would have to take any legal action on my own. I had to scramble to find additional funds of my own to get the project completed.

Is the 203K office liable in anyway or obligated to support me? They kept saying that this is "federally insured funds, he's going down" but then nothing has happened? I spoke to the RE lawyer who did my closing and she stated that this happens all the time, even with contractors who people have been working with time and time again. I don't want him to just walk away free and clear but taking criminal legal action would be more money than I want to spend at this time. I can do a small claims request but I'm afraid that may go no where if he doesn't have the funds.

Any advice would be helpful. Thanks for listening.