Home Improvements Sold by Direct Sellers
Home repairs and renovations are a fact of life. The roof needs shingling, the windows need replacing, awnings, siding or insulation needs installing, the stucco needs patching, the whole house needs painting, the driveway needs refinishing, the basement needs finishing. The list goes on.
You may decide to do some of the work yourself. Other jobs you may prefer to contract out to a reliable company.
In some cases, direct sellers may approach you and offer their home improvement services. A salesperson may knock on your door, telephone to arrange an appointment, send you an unsolicited offer in the mail, or encourage you to sign a deal at a home show display.
Signed contracts, estimates and loan applications are legally binding. If you have any doubts at all, do not sign anything.
Most companies using the direct sale approach are reputable businesses that hire competent staff, perform quality work, and ensure that their clients’ rights are respected. However, misunderstandings can lead to problems. You can avoid difficulties by following these tips offered by the Consumer Protection Office.
Ask to See a Direct Seller’s Licence
The Consumer Protection Office licenses vendors engaged in direct selling and also licenses sales representatives who act as direct sellers.
- Read the licence carefully. Look at the date to see that it is still valid. Write down the name of the company being represented and the name of the salesperson.
- If a door-to-door salesperson cannot show you a direct seller’s licence, write down his or her name and the name of the company being represented. Give this information to the Consumer Protection Office.
- Contact the Consumer Protection Office if you have a complaint. Your complaint could result in a claim against that vendor’s bond.
Get Two or Three Detailed Written Estimates
Tell contractors that you are getting other quotes. Remember that written estimates do not require your signature! An estimate should:
- Be dated;
- Describe the work to be done;
- List the materials to be supplied as to brand name, quantity, grades, color, etc.;
- Include labour specifications (make sure all sub-trades are covered);
- Outline the cost breakdown, total cost, and amount of deposit;
- State a starting and completion date (you want the job done on time);
- Specify how the contractor will be paid;
- state insurance and warranty coverage.
Compare what each company has to offer. Be especially cautious of extremely low estimates that could mean compromises in material or quality of work.
Think About the Offer Before You Sign
Take some time to talk it over with friends or relatives without any pressure from the salesperson. Do you really need this work done?
Take a look at your bank account. Can you afford this expense now?
Consider contacting a lawyer before you sign a contract for work amounting to hundreds of dollars or more. Be sure that you understand your legal obligations before you sign.
Check Into Each Company
Find out who does the actual work. A seller may sell a signed contract to another company.
Check with the Consumer Protection Office regarding licensing. Call the Better Business Bureau to see if they have received any complaints about any of the companies you are considering.
Contact references and look at the work done for them. Although the company will likely give you only the names of satisfied customers, you may learn what pleased them. What would they do differently the next time and why?
Be Careful with Down Payments
A 10% down payment is reasonable. It is a good idea to pay by cheque. A cancelled cheque is a legal receipt.
Remember your right to cancel a direct sales contract within 10 days.
After you sign a direct sales contract, you have 10 days (excluding the day you sign) to gather facts about the company, to get other estimates or to change your mind. You do not have to give the company your reasons for canceling the contract.
You can cancel the deal by:
- registered mail,
- personal delivery, or
- any method by which you can provide evidence of the date of cancellation
Direct sellers must provide you with written information about your right to cancel a direct sales contract within 10 days. Upon cancellation, the company must return all deposits, put down, goods traded in, rent paid on a rent-to-own item, or cost of credit.
It’s a good idea to phone the Consumer Protection Office to make sure you are canceling correctly.
Protect Yourself Against Property Liens
The Builders’ Liens Act covers residential construction on contracts over $300.00. You are entitled to hold back 7.5% of the total cost of work, services and materials for 40 days after the contractor has reached substantial or total performance of your job.
Suppliers or employees of the contractor can file liens against your property if, for some reason, the contractor does not pay them.
A lien gives an unpaid worker or supplier the right to make a claim against your property for wages or costs.
If a supplier or employee files such a lien, you can use the money that you held back to pay.
Refer to The Builders’ Liens Act for more detailed information. Copies of the act are available at Statutory Publications, 200 Vaughan Street, Winnipeg, R3C 1T5 or at Manitoba Laws.
Pay For Work As it is Done
Never prepay in full. If your contract calls for progress payments, be sure that work is done before you pay.
With each progress payment, have the contractor sign a Statutory Declaration that creditors and workers have been paid to date for materials and work on your project. These forms are available at business stationery stores.
Make the final payment only if:
- You and the contractor agree that the job is finished; and
- You have checked with the Land Titles Office on the 40th day to make sure that no liens have been registered.
For more information contact:
Consumer Protection Office
302-258 Portage Avenue
Winnipeg, Manitoba R3C 0B6