Homeowners hire a remodeling company, pay a deposit or almost all of the contract price, then the contractor vanishes. Some later find out that subcontractors weren’t paid for their services. Those subcontractors often start threatening to put a lien on the home. In most states, electricians, plumbers, and other contractors can put a lien on a home for structural work done regardless of who actually requested the services. The rationale is that the services are an improvement to the real property therefore the homeowner is exposed to a lien on the home, commonly known as a mechanics lien (I know! Don’t ask).
The homeowner must first figure out a goal i.e. do you want to get your money back or have the contractor complete the work? This is a tough call – most times these contractors don’t have the funds anymore and are robbing Peter to pay Paul. On the other hand, it’s a little scary to trust the work of a contractor who didn’t keep his/her word in the first place. The good news is that many of these jobs require city inspectors to approve milestones. The objective inspections might serve to provide some peace of mind.
You could file a complaint with the Consumer Protection Division of the Attorney General’s Office. Also check to see if there is a professional licensing board that you can file a complaint with. Not all trades are required to be licensed so, check with the agency in charge. In Texas, you would check with the TDLR (Texas Department of Licensing and Regulation). If you’re under a tight time constraint, you may have no choice but to hire another company to finish the work then sue for monetary damages and any other damages. In the meantime, you should send a demand letter requesting a specific action. A lawyer can help you with this if needed.
The demand letter should be mailed certified mail with return receipt, and should be simple and direct:
a) State the terms of your agreement;
b) State how the contractor failed to comply;
c) State what you want e.g. cancel the agreement and receive a refund; complete the work asap.
d) Make sure there is a deadline e.g. If you don’t respond within 10 days, I will have not choice but to take legal action.