University of Missouri Extension

Chuck Adamson
Senior Information Specialist
573-882-6843
adamsoncw@missouri.edu

Published: March 23, 2006
Story Source: Brenda Procter, (573) 882-3820; Eric Evans, (573) 884-8984

In wake of tornado and hail storms,
take steps to seek reputable contractors

COLUMBIA, Mo. – Missouri homeowners hammered by hail and tornadoes in mid-March are still cleaning up and assessing the damage from one of the most massive tornado outbreaks in the state’s history.

It’s brought a glut of building contractors to the state advertising repair services.

Homeowners need to know how to distinguish the good contractor from the bad, said Brenda Procter, University of Missouri Extension personal financial planning specialist.

Not all contractors are bad, of course, but disreputable ones sometimes flock to a natural disaster,” Procter said. “Disaster victims can, understandably, have a hard time thinking clearly. Making a sound decision can be difficult when your world has just been turned upside down.”

She offers a series of tips on picking a reputable contractor.

  • Check contractors’ business reputations with trade councils, the state attorney general’s office and the Better Business Bureau, either in Missouri or in the area where the contractor is based. Also, ask for references and call them.
  • Get proof of insurance, including disability and workers’ compensation insurance, which is necessary to cover worker accidents on your property.
  • Ask contractors how long they have been in business and when and where they have done work similar to what you’re seeking.
  • Obtain three quotes, if possible, on repairs to ensure you’re not being gouged.
  • Sign a formal contract before work begins. Have a trusted friend or professional review it before signing.
  • Never pay the entire project amount in advance. Contractors typically require a series of payments, each made upon the completion and inspection of defined work.
  • Insist that the contractor provide a signed statement and proof that all subcontractors have been paid, before you make the final payment. If not, you risk having a lien placed on your home.
  • Pay by check or money order, never cash, so that you have proof of payment. “If the contractor wants cash only, find another contractor,” Procter said.
  • Use respected local contractors when possible. Often that’s difficult, since disasters will bring them more work than they can handle. “Local contractors will be there to guarantee their work long after the storm is over,” Procter said.
  • Keep all receipts from repair, clean-up and temporary housing. There is a chance you may qualify for casualty loss deductions in 2006 federal income tax calculations.

If insurance doesn’t cover the total repair costs, several types of loans are available to homeowners.

According to certain criteria in disaster areas, the U.S. Small Business Administration offers medium- and long-term loans for rehabilitation of non-farm homes and small businesses. Borrowers may obtain more than their total repair needs to apply toward storm damage mitigation measures for future storms.

Commercial and federal land banks offer loans with moderately low interest rates for home repairs, improvements, equipment and livestock. Insurance companies issue long-term loans at relatively high interest rates.

Many Missouri counties were declared a disaster area by President George W. Bush following the March 11 and 12 tornado and hail storms that ravaged the area. The federal declaration comes in two forms, for public agency assistance and for private citizen assistance.

A declaration for private citizen assistance allows certain homeowners and storm affected individuals, who don’t already qualify for loans, to obtain grants – money that isn’t paid back.

“It can include rental assistance, subsistence assistance, like food and clothing and even burial assistance, in the event of disaster-related deaths,” said Eric Evans, MU Extension emergency management specialist. “People ought to pay close attention to what their leaders are saying regarding the declaration.”

To find out whether your county is on the federal list of disaster areas go to the Missouri State Emergency Management Agency Web site at http://sema.dps.mo.gov/SevereStormsMarch2006.htm.

SEMA has requested that more Missouri counties be added. Counties not listed yet could be added later, Evans said.

For more information contact your local MU Extension office, log on to http://extension.missouri.edu or for resources by Procter, log on to http://missourifamilies.org.

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