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Mercado Construction & Design, Inc.

Phone: (916) 984-8466 Fax: (916) 984-8446 View Additional Phone Numbers 2795 E Bidwell St Ste 111, Folsom, CA 95630

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Mercado Construction & Design, Inc. offers residential and commercial construction and design services.

BBB Accreditation

A BBB Accredited Business since

BBB has determined that Mercado Construction & Design, Inc. meets BBB accreditation standards, which include a commitment to make a good faith effort to resolve any consumer complaints. BBB Accredited Businesses pay a fee for accreditation review/monitoring and for support of BBB services to the public.

BBB accreditation does not mean that the business' products or services have been evaluated or endorsed by BBB, or that BBB has made a determination as to the business' product quality or competency in performing services.

Reason for Rating

BBB rating is based on 13 factors. Get the details about the factors considered.

Factors that raised the rating for Mercado Construction & Design, Inc. include:

  • Length of time business has been operating
  • Complaint volume filed with BBB for business of this size
  • Response to 1 complaint(s) filed against business
  • Resolution of complaint(s) filed against business

Customer Complaints Summary Read complaint details

1 complaint closed with BBB in last 3 years | 0 closed in last 12 months
Complaint Type Total Closed Complaints
Advertising/Sales Issues 0
Billing/Collection Issues 0
Delivery Issues 0
Guarantee/Warranty Issues 0
Problems with Product/Service 1
Total Closed Complaints 1

Customer Reviews Summary Read customer reviews

0 Customer Reviews on Mercado Construction & Design, Inc.
Customer Experience Total Customer Reviews
Positive Experience 0
Neutral Experience 0
Negative Experience 0
Total Customer Reviews 0

Additional Information

BBB file opened: April 09, 2007 Business started: 01/01/1997 in CA Business incorporated 02/22/2007 in CA
Licensing, Bonding or Registration

This business is in an industry that may require professional licensing, bonding or registration. BBB encourages you to check with the appropriate agency to be certain any requirements are currently being met.

These agencies may include:

Contractor's State License Board
9821 Business Park Drive, Sacramento CA 95827
Phone Number: (800) 321-2752
The number is 736764.

Type of Entity


Business Management
Mr. Favian Mercado, President Mr. Gabriel Mercado, Vice President
Contact Information
Principal: Mr. Favian Mercado, President
Business Category

Contractors - General Home Improvements Home Improvements - Additions Engineering Contractors - General

Products & Services

Mercado Construction & Design, Inc. specialize in residential and commercial improvements in Northern California.

Industry Tips
Hiring a Contractor in California: Essential Tips Knowing Your Refund & Cancellation Rights

Additional Locations

  • 2795 E Bidwell St Ste 111

    Folsom, CA 95630 (916) 984-8466 (916) 365-9177


BBB Customer Review Rating plus BBB Rating Overview

BBB Customer Reviews Rating represents the customers opinions of the business. The Customer Review Rating is based on the number of positive, neutral and negative customer reviews posted that are calculated to produce a score.

Customer Review Experience Value
Positive Review 5 points per review
Neutral Review 3 points per review
Negative Review 1 point per review

BBB letter grades represent the BBB's opinion of the business. The BBB grade is based on BBB file information about the business. In some cases, a business' grade may be lowered if the BBB does not have sufficient information about the business despite BBB requests for that information from the business.

BBB Letter Grade Scale

BBB Rating Value
A+ 5
A 4.66
A- 4.33
B+ 4
B 3.66
B- 3.33
C+ 3
C 2.66
C- 2.33
D+ 2
D 1.66
D- 1.33
F 1
NR -----
Star Rating scale

  Average Score
5 stars 5.00
4.5 stars 4.50-4.99
4 stars 4.00-4.49
3.5 stars 3.50-3.99
3 stars 3.00-3.49
2.5 stars 2.50-2.99
2 stars 2.00-2.49
1.5 stars 1.50-1.99
1 star 0-1.49

BBB Customer Review Rating plus BBB Rating is not a guarantee of a business' reliability or performance, and BBB recommends that consumers consider a business' BBB Rating and Customer Review Rating in addition to all other available information about the business. If the BBB Rating is NR then only Customer Reviews are used for the Star Rating.

Complaint Detail(s)

6/25/2013 Problems with Product/Service | Read Complaint Details

Additional Notes

Complaint: Contractor failed to provide quality workmanship and materials as agreed. We have been charged for work not completed. Disagreements for months about intent of contract (which does not comply with CA law), never resolved. Issues with quality of work. Various items paid for, not provided. Partial list: -Kept $3238 in funds from from advance check ($12290) for permits. He later admitted, in writing, to simply keeping as "profit". - Mistake in measuring foundation, result in loss of 160 sq ft habitable space. We paid permits, school fees based on square footage. Taxes computed that way - county already following up on that. Less sq ft, lower property value ($250 / sq ft common number in this area). - Substitution of inferior materials - example - we paid for fiber cement trim, they used wood where they thought that we wouldn't notice. Lied about it to ***** - had to cut a piece off to prove it was wood. Finally said they'd fix it. Never did. - Contingency funds taken as additional P&O, not used for construction related items. - Charge for remote for fireplace, not installed in unit - then they lied and said that remote just not delivered. Unit does not have remote capability installed. - Bait and switch on decking - paid for composite decking. Offered $500 "discount" to go to redwood, then installed "natural wood" (we are not sure if it is even redwood) and wanted to charge $1500 to stain it! - Charged for painting entire exterior - after charging us $4000 extra for pre-painted siding. - Numerous quality issues. Failed final inspection - tempered glass paid for, not installed.

Desired Settlement: Restitution of damages, direct and indirect. Release of liability, release from contract, lien releases. We cannot receive the remainder of our funds from our bank loan while disagreement exists. We really just want to fire them, once and for all. We've tried several times now.

Business Response: Business' Initial Response
Contact Name and Title: ****** ******* -President Contact Phone: XXX-XXX-XXXX Contact Email: ****** Mercado Construction was contracted by the ********* for a house addition project. We entered into a lump sum contract and were approved by their lender and a third party agency to handle all payments and inspections for this project. The total contract amount of ($243,800) did not include fees to cover the building permit cost (which the ****'s acknowledged as an expense they would be paying for directly). This expense of ($8,176) in addition to extra work the ***** requested in the amount of ($16,554) ultimately put the project over budget ($24,730). Mercado Construction performed all contracted work under the direct supervision of County's Building department and the third Party's inspections. All work was accepted by the ****'s and complimented on the level of quality ******* Construction and it's subcontractor's were providing. Once the ****'s extended their budget amount for the project they began to request and at times demand changes to the contract amount to help them continue with their project. This process was well documented and administer with the lender and lender's third party agency. The ****'s approved all revised cost estimates. Mercado Construction provided services up to the finish process of the project and per their request allowed some trades to be performed by them as well as other tradesmen hired by the ****'s. This process ultimately delayed the project and prevented Mercado Construction to continue and complete with contracted work due to sequencing of construction common practices. There is an order for work to be performed and cannot be randomly sequenced. The ****'s claims of funding or quality of work did not arise until the end of the project for obvious reasons mostly funding of their project. These claims are not substantiated and in fact are defamatory in nature. Mercado Construction never left the ****'s uninformed of any work or cost amounts for this project. In fact, Mercado Construction has made efforts and have always made clear our intent to finish the project and take care of any remaining items under our contract agreement. We stand behind all of our work and have never left any project uncompleted.

Consumer's Final Response
(The consumer indicated he/she DID NOT accept the response from the business.) We do not accept *******'s proposed solution because no solution has been proposed. This response holds no new information. If the current response is read side by side with the original response, they say essentially the same thing but it is simply a story. This can be seen by reviewing the complaint's history, but that seems to have been removed from the website. These responses contain false statements made by *******. In this response ******* clearly indicates that the contract signed in March changed substantially in nature through informal means. ******* claims that we approved cost increases but CANNOT PROVIDE EVIDENCE THAT THIS IS SO. Example: ******* increased the bid for lumber *after the project began*. This is another demonstration that the original contract was not honored by *******. ******* claims we approved the increase, which would require that they, as project managers, prepare a Job Change Order that must then be signed by both parties. This is required by California law as well as by *******'s own contract and it did not happen. *******'s current response supports that position: "The framing cost increase for the ****'s project resulted in the material increases from the lumber companies from the original cost provided in March to when the project actual start in September 2012." ******* changed dollar amounts immediately after starting work because the original contract was no longer applicable. Costs had changed. ******* claims that they consulted with us about discrepancies in the plans. This is absolutely not true because we would have needed to work with the architect that drew up the plans to make changes, which did not happen. ******* states, "The outdoor deck was re-configured by the ****'s and additional work requested such as stairs added to this area." This is also simply not true - we discussed changes to the deck that were never made and the stairs were always a part of the plans. They're on the original plans approved by the county, labeled as "stairs to grade". ******* also admits that they did not complete the project per plan referencing, "work from independent tradesmen they hired to provide services removed from our scope of work such as tile and flooring. " Because they did not fulfill their part of the contract it was clearly breached and they would not be owed the full amount, even IF no other changes were made. Their scope of work was reduced during the project and so their compensation also went down. ******* continues to list cost increases (some fabricated) but fail to include the many reductions in scope and the work that was not performed by them. We have contributed substantially to the project beyond the money managed by the bank. For ******* to claim that they have contributed financially is simply ridiculous. ******* has not provided a detailed cost breakdown report at any time. The only detailed reports for the project have been prepared by us and the funding company. One such report is entitled "Cost Breakdown", authored by us and the funding company, dated 1/15/2013 and is the direct result of a telephone conference call held on 12/10/2012. This call included us, ******* and the funding company and it was recorded with the agreement of all parties. During this call and later documented by the spreadsheet, it was made very clear and agreed by all that the total cost of the project would not exceed the loan amount, that compromises would be made in scope and that payment would be made based upon who performed the work. We have the recording from that phone call and the spreadsheet is signed by both parties. The claim that we have been happy with their work from the beginning has already been refuted and can be proven by numerous examples. We had begun to work with other subcontractors, going so far as to get bids, as early as November of 2012. On November 15, 2012 we paid another contractor to evaluate the HVAC system installed by ******* (a number of deficiencies were found) because of the poor quality. We did so because we anticipated that ******* might try to argue about the quality of their work so we secured a professional evaluation to rebut their claims. We have that written report. The foundation for the project was measured wrong. The project as built is substantially smaller than the plans. This can be measured. Given that we were shopping around for other people to do the work only two months after the project began, *******'s claims that we were happy are simply not true. If we were provided "detailed punch lists", where are the copies? ******* says they have not been notified in writing that their contract was terminated. That the contract signed in March of 2012 was applicable in any way throughout the project is questionable. That ******* has been notified in writing that they were released is quite clear. The telephone meeting held on December 10, 2012 was a result of our suspending *******'s access to the financing for the project, all of which is documented via email. As part of a previous statement in this BBB complaint we said, "******* did, in fact, leave this project uncompleted. They were fired." ******* has been notified. We ended *******'s involvement in the project in early March, after they failed to meet a deadline (in writing) that we'd set for them to finish work for which they had been fully paid. On April 2, 2013 the county performed a final inspection that we failed because of nine violations, all of which were due to work performed incorrectly by *******. We corrected those items at our own expense and passed ***** inspection on April 22, 2013. The delay was caused because a window ******* installed that was supposed to be tempered glass (and was not) needed to be ordered. Our Notice of Completion was filed on April 25, 2013. Even with the delay caused by *******'s errors we completed the project quickly once they were gone. *******'s response is full of contradictions. Early on in the story they say, "This change in loan amount was not approved by the bank and resulted in Mr. ****'s financial challenge to pay for his additional work." Later they change the tale to, "The only time the ****'s have raised any issues with the work or with financial concerns came as the project was at a standstill from the delay of the tradesmen they provided." ******* claims a "lump sum agreement" and then wants to charge substantially extra for increased material costs. Nowhere do they credit us for any of the numerous *reductions* in the scope of work or the many materials we purchased directly. ******* is after us coming and going. *******'s claims that they have been cooperative are ludicrous. We asked for the return of the building permits folder so that we could get the final inspections done. They didn't return our property. We asked for Title 24 documentation. They didn't provide it. They have not approved a payment request we filed with the funding company to release our loan funds. They have retained an attorney and sent threatening letters. That is not cooperation. It is incredible that ******* continues to claim that they are still owed money when they freely admit that they did not complete all of the work. In addition to the reasoning for failing to do so being fallacious, it is also irrelevant because the contract was clear that in order to be compensated that they would perform the work, per plan. They did not and this is irrefutable. *******'s own admission is that the original contract changed substantially and so for them to continue to claim they are owed a blanket fee is ludicrous. They cannot simply provide a detailed cost breakdown of the entire project (which should be a *basic*, ongoing project management task) on demand. To say they "have provided" such a report but to fail to be able deliver it *now* is absolutely unacceptable. Our attorney is still waiting for delivery of that documentation and it needs to be done immediately. All of this information, including the older responses, will be provided to the California State Contractors License Board as part of our existing complaint (NA XXXX XXXXX) with them.

Business' Final Response
******* Construction and the ****'s entered into a $243,800 lump sum agreement in March 2012 for the construction of a house addition project. The contract amounts were for plans and specifications provided by the client at that time. The Client did not finalize their financing until September 2012. Per the request of the ****'s an itemized cost breakdown was created and provided to the Lender (this itemized cost breakdown was for the lender's use only and was not a change in the lump sum agreement we had executed), at this time Mr. **** changed the total loan amount request to be increased $32,000 for a new amount of $275,994 to help finance his permit fees and additional work he wanted to add to his project such as adding a hot tub off his new bedroom deck. This change in loan amount was not approved by the bank and resulted in Mr. ****'s financial challenge to pay for his additional work. The framing cost increase for the ****'s project resulted in the material increases from the lumber companies from the original cost provided in March to when the project actual start in September 2012. This price increase was approved by the ****'s prior to materials being ordered for their project. The ****'s requested throughout the duration of the project additional work to be performed. Prior to any work being started Mercado Construction provided a cost for each item to be reviewed and approved by the client. The ****'s approved 29 additional items to be performed. The amount of theses 29 items was $24,730. This amount had to be processed through the construction loan and resulted in a demand from the ****'s to Mercado Construction to reduce the agreed contract amount and be able to finance these changes. It has never been Mercado Construction's responsibility to help finance the ****'s project. This project was managed by an independent third party agency hired by the Lender to provide fund control and inspections. Their system required all parties to approve each draw request. No monies were processed without the approval of the ****'s and without a field inspection of the work. Throughout the construction of this project Mr. **** complimented us and all of our sub contractor's work as quality and detailed. Mercado Construction conducted regular meeting with the client to walk through the project and reviewed progress work as well as address any questions or concerns the ****'s had. Detailed punch lists were created for all parties to review during the project. Mercado Construction built this project off of the plans provided by the ****'s and approved by the County. These plans had discrepancies from the new addition area to the existing house. Mercado Construction made the ****'s aware of these discrepancies and provided them alternative options to build this project as it was originally designed. There is not a 20% difference in any measurements or size for this project. The outdoor deck was re-configured by the ****'s and additional work requested such as stairs added to this area. Mercado Construction stands behind all of their work. They have been licensed since 1997 and have never had a single claim from any client or project they have provided work for. The range of work Mercado Construction provides is from $30,000 to over $1Million custom home projects. Mercado Construction's agreement stipulates that the client has the right to cancel the agreement if the Contractor fails to carry out the work in accordance with the scope of work. The Client may after 10 days of written notice terminate the Contract and shall compensate Contractor for services rendered as outlines in the schedule of fees. Mercado Construction has not received any written notice from Client. Mercado Construction was not allowed to complete the project as set forth in the agreement due to the Client holding up the work from independent tradesmen they hired to provide services removed from our scope of work such as tile and flooring. These trades prevented other contracted work to be completed. The only time the ****'s have raised any issues with the work or with financial concerns came as the project was at a standstill from the delay of the tradesmen they provided. The work concerns were from uncompleted items and the financial concerns were from cost overruns for the additional work the ****'s requested. Mercado Construction has provided the ****'s a detailed cost breakdown report itemizing all credits to the ****'s for items or work they provided to the project and has made all adjustment for only the work that has been completed by Mercado Construction. Mercado Construction has been cooperative with the ****'s to finalize their project and help release all funds to them. Mercado Construction cannot contribute financially to the ****'s project any more than they already have by means of reducing cost during construction and is owed a balance for the project.