All Forum Posts by: Katelynn Malivert

So sorry to hear this Zaki! The same situation happened to me about a month ago in Cincinnati. I bought a duplex in hopes of inhabiting one unit while I rented the other. My contractor was supposed to do a full gut renovation (bathroom, kitchen, floors, everything!). He basically did demo and some terrible electric and tiling then left; he stopped responding to any and all communication. We had already paid him $43k (in installments; way too much for nothing). The only thing that saved me was that I paid with no interest-bearing CCs. So I disputed each and every charge. I gave tons of information to the bank and within 4 weeks I was credited every single dollar that was paid to the contractor.

I also considered going after him legally, but after speaking with a lawyer in our area. He suggested sending a demand letter (that would cost us $2500), which the contractor could just ignore, and take him to court but the costs of everything may cost us more than we lost. Also we would have to make sure that the contractor actually had assets to garnish if we did choose to go after him.

This was my experience.

I know it’s a lot to consider but I hope you’re able to find a resolution that you’re content with.

Quote from @Jonathan Klemm:

@Katelynn Malivert - Totally my fault didn't realize I was on the 2nd page and coming to the party late!

Anyway, that is awesome that you were able to get your money back - God is good!  Also super smart to take baby steps to get it finished up.

Most importantly thank you for taking action and filing a report.  I wish more people in my area (Chicago) would do that because so many of these general contractors just go from person to person to person robbing them.

Hey Jonathan, no worries at all! And yes I agree, God is good!

Quote from @Jerryian Francois:

Quote from @Katelynn Malivert:

Quote from @Tracy Ross:

I agree with @Chris Seveney. And potentially look into hiring a real estate attorney who can at first send a letter to the contractor threatening to file suit. If that doesn't get him moving then at least you have someone on retainer in case you need to follow through. 

Yes, we actually did contact a lawyer and it would have costed us $2500 just to send out a demand letter. Because this was blatant fraud, we highly doubted the contractor would be spooked enough to pay up. We deemed it would’ve been a waste of resources. However, if we weren’t lucky enough to recoup our expenses from our CC company we were definitely prepared to follow through with litigation but that was our last resort as it would’ve been timely and costly. Luckily for us, our CC company paid us back every dollar that was paid to this contractor.

 Wow that’s awesome glad you got your money back ! What awesome cc company allowed the refund just curious !?

Hey Jerryian, Bank Of America! 

Quote from @Benjamin Sulka:

Katelynn, 

So relieved that you got your money back. Your persistency through this adversity is extremely commendable! 

What was your process for interviewing contractors? 

 Hey Benjamin! Thank you so much. I consider myself very lucky to have the outcome I did. The process of interviewing was mainly done by my boyfriend. He interviewed about 6 contractors, half never got back to us with an estimate after viewing the property. In Ohio, a license isn’t required for a GC so we weren’t adamant about our contractor having one (although we should have been). The contractor we chose was initially  very professional; he communicated with us efficiently and quickly. He had reached out to my boyfriend via a post my boyfriend made in his real estate group. 

Quote from @Jonathan Klemm:

Hi @Katelynn Malivert - I am super sorry to hear about this tough experience, but believe me you are not alone.  This is too often a story I hear about contractors and it really stinks because they are giving the rest of us a horrible name.

I have a couple of questions that can help us understand exactly where you are at.

What was the original contract value?  

What was the scope of work?

What % of the scope of work is completed/remaining?

Was there a contract signed?

How much do you think it will cost to finish it?

What area/state/city are you in?  Here in Illinois in Chicago it is quite difficult to recover money and the state makes it easy for contractors to put in place a mechanic lien.

 Hi Jonathan,

I believe in my original and updated post these questions were answered; however it can get lost in all the replies etc. I am happy to answer your questions nonetheless.

The original contract value and monies paid was $43k (I originally wrote $36k but that was an error).

The scope of work was a full home renovation including bathroom, kitchen, flooring, electrical, plumbing, demo of half-walls, & lighting.

The percentage of work completed couldn’t have been more than 20%. Demo was done, some electrical and plumbing (however by an unlicensed person -we found this out after the fact). A few pieces of tile work in the bathroom (which was done incorrectly and was completely gutted by our new contractor). The unit was left uninhabitable. 

Yes, there was a signed contract.

It will probably cost us approx $50k to do the entire home. We are already putting in almost 20k in the bathroom, as everything that was previously done had to be gutted and redone to meet quality standards.

I am in the Cincinnati area. Luckily we found a new licensed contractor to work with. Right now he is only doing the bathroom, we will see how everything goes but right now we are happy with the progress.

Hopefully this answers your questions Jonathan. Thanks so much for your response!

Quote from @CJ M.:

@Katelynn Malivert

I'm so happy to hear you got your money back!!...and I would totally pursue your legal options since they tried breaking in! One other thing I'd add is that I never pay my contractors in full before the work is done. If anything, consider breaking the payments up into chunks. Agree on payment after X is done...then another payment after Y is done...etc.

The problem with some contractors is they work many projects at once. If any of those fall behind or cost more, they take money from another project to cover it...thus causing another investor(s) issues.

Anyway, my two cents :)

Thanks CJ! Yes we learned that quickly. I appreciate your response.

Quote from @Bruce Woodruff:

Quote from @Katelynn Malivert:

Glad you got your money back and hope the original scammer gets what is due him.

When you say you're dividing work between Contractors, do you mean you hired more than one General Contractor? Hope not.... More likely you are acting kinda as an Owner/Builder and hiring the Sub-contractors (Plumbers/Electricians/Hvac/Etc) yourself?

Hey Bruce! No I just hired one GC to do one area of the unit, the bathroom. We hired someone else to finish up the dry wall and we’re going with a local flooring company to do our floors. All were vetted and licensed. Yes, we are hiring our own plumber and will use the electrician that the GC has recommended. This is all for one area of the house, the bathroom. Once the bathroom is done and if the experience goes well, we will most likely hire that GC to do our kitchen. But right now we are taking baby steps. Great question!

Quote from @Gabe R. Gonzalez:

@Katelynn Malivert It looks like others have given you some good pointers. If nothing else works, tell him you'll write off any work he hasn't done by issuing him a 1099. He'll have to pay taxes on this and might put him on the radar of the IRS. Might be a good scare tactic to keep in your pocket. 

Thanks Gabe, never thought about this. As of 12/11 he refuses to respond to any correspondence from us so that may not work in our situation, but I will keep that in my back pocket for future reference. All in all, we were able to get all our money back from our bank. So as of now, I’m just working on reporting his ***! Thanks for your response.

Quote from @John Patterson:

@Katelynn Malivert do you have his business license or address? Go see him and confront him with your agreement that you both signed. Ask for reparations or there will be a court date in small claims. May or may not work, but you going to his business shows that you know where he lives… and not going away. Your other option is to send him a certified letter with a notice to stop, and find the higher priced better contractor.

Contractors are like Toyotas; the good ones are usually more expensive , well seasoned from a few years of use , start when you want them to, and run long and hard. But you still need to make sure they have insurance.

Hey John, great advice! We did confront him via a call with a police officer (which he answered( but of course he denied everything. He never had a place of business but we do have a residential address. Instead of potentially putting ourselves in harms way we went ahead and filed a fraud report with our bank (I made payments with a CC). We recently were refunded 100% of the charges that was made to this contractor. Now we are in the process of working with Ohio’s DA in order to prevent this from happening to other people. A demand letter was going to cost us $2500 and we figured it wouldn’t be helpful as this guy was blatantly scamming us. We are now working with new licensed contractors that were vetted thoroughly and we are dividing the work between several business instead of having one do everything. 

Quote from @Katlynn Teague:

Hey Katelynn, first off love the name!! 

I am so sorry this situation happened. I know you probably did not go into it expecting the worst to happen. You need to do everything you possibly can to get that money back and hopefully give that crook what he deserves. You have had a lot of good advice given to you up top, just a matter of turning it into action now!  

My boyfriend and I are looking at doing the same thing. We found a duplex that was severely fire-burned. Probably looking at a renovation budget of $130k. Trying to find reliable licensed contractors is the hardest part. However, we will not work with anyone who cannot provide at least 5 quality referrals and is fully licensed. I know some investors work with unlicensed contractors and get great work with cheaper cost but its all about liability. 

 I agree! Thankfully we have gotten all our money back via our bank; now we are moving forward with qualified and Licensed contractors. Thanks for your response and good luck on your house hack!