Educational Consumer Tips
Author: Better Business Bureau
This report is general in nature and is not intended as a reliability report on any company, service or product.
The Pennsylvania Legislature in October 2008 signed into law the Home Improvement Consumer Protection Act (HICPA) requiring contractors to register with the Bureau of Consumer Protection of the Pennsylvania Attorney General (Bureau). The law also requires that certain terms and language be used in contracts.
A toll-free telephone number to check whether a contractor is registered with the Office of the Attorney General has been established at 888-520-6680 or by going online to List of Registered Contractors. Under the law home improvement contracts will be required to have this toll free number and registration number posted in the contract.
WHO IS REQUIRED TO REGISTER: Contractors' jobs valued at more than $500 worth of work for a consumer on their home or land and, who do over $5,000 of home improvement business annually will be required to bring their contracts into compliance and to register with the Bureau by
The law applies to contractors defined as:
Companies who are involved with the construction, replacement, installation or improvement of: driveways, swimming pools, solar energy systems, pool houses, garages, roofs, siding, insulation, security systems, flooring, patios, fences, gazebos, sheds, cabanas, painting, doors, windows, waterproofing, installation of central heating or air conditioning, and installation of storm windows or awnings.
INFORMATION REQUIRED TO REGISTER: To register, a company must provide:
* Names, home addresses, telephone numbers, driver's licenses numbers, social security numbers, and all prior business names and addresses of the home improvement businesses operated by the individual, partner, officer and manager;
* A complete description of the nature of the business; and provide a statement which lists whether he or the company has ever been convicted of a criminal offense relating to a home improvement transaction, fraud, theft, deception or fraudulent business practices;
* Disclose any final civil judgments entered against it relating to a home improvement transaction in the last 10 years, or whether it has ever filed for bankruptcy;
* And, inform the Bureau whether they are registered in another state or municipality, and if any disciplinary action has occurred in that state or municipality. Provide proof of liability insurance in a minimum amount of $50,000.
WHAT IS IN A CONTRACT: The new law requires that home improvement contracts:
* Be legible, in writing, and include the registration number of the contractor;
* Be signed by the owner and the contractor or a salesperson of the contractor;
* Comprise of the entire agreement;
* Include the date of the transaction;
* Contain contact information of the contractor;
* Consist of the total sales price and any down payments;
* Include approximate starting date and completion date;
* Contain description of the work to be performed, the materials to be used and a set of specifications;
* Include the names, addresses and telephone numbers of all subcontractors on the project;
* State that the contractor agrees to maintain insurance and identifies the current amount of insurance;
* Include the toll-free telephone number for the Bureau;
* And a notice of the Right of Rescission.
A copy of the contract shall be provided to the consumer at the time it is signed.
Committing home improvement fraud can be prosecuted as a misdemeanor or a third-degree felony. If the victim is 60 years old or older, the grading of the offense will increase. HICPA also gives a court the ability to revoke or suspend a contractor's certificate. If revoked, a contractor can only petition the court for reinstatement after five years have elapsed.
In addition to the registration and contractual requirements imposed, HICPA expands the Unfair Trade Practices and Consumer Protection Law to provide for additional prohibited acts that will give rise to a civil action by consumers.
A contractor is required to fully refund any amount paid by a customer within 10 days after it receives a written request for refund, if 45 days have passed since the work was to begin, and no substantial portion of the work has been performed. A contractor is also in violation of the Unfair Trade Practices and Consumer Protection Law if it materially deviates from plans or specifications without a written change order that contains the price change for the deviation.
Another important expansion of the Unfair Trade Practices and Consumer Protection Law holds that for a contract of more than $1,000, the contractor cannot accept a deposit in excess of 1/3 of the contract price, or 1/3 of the contract price plus the cost of special order materials.
Furthermore, attorney fees and costs may no longer be recovered by a contractor in an action against a consumer that fails to pay.
The Home Improvement Consumer Protection Act has many more requirements which will affect how contractors do business in Pennsylvania. The above information lightly touches on some of the key points of the law. Go to the Home Improvement Consumer Protection Act for a copy of the law.
For more advice you can trust from your local BBB on avoiding scams and fraud, go to www.bbb.org.