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March 18, 2013

The Law and Your Home

Remodeling and the Law

Which federal laws are applicable to remodeling projects?

Federal Trade Commission (FTC) rules address the problem of false advertising. It is illegal for a vendor to advertise any product or service for less than it really costs or to engage in the old bait-and-switch tactic. The law requires vendors to offer a rain check whenever demand for an advertised bargain exceeds supply, unless the limited supply is clearly stated in the ad.

The federal Truth in Lending law protects consumers who obtain outside financing for their projects. A lender must prominently state the annual percentage rate (APR) of interest you will be charged. So whether you finance your home improvement through a bank, a credit union, or the contractor himself, at least you will know what the interest rate is.

Even if the terms appear reasonable, it is a bad idea to have the contractor secure financing for your project and in some areas it may also be illegal. Even though he may approve you as a credit risk when a bank won't, he has good reason: his guarantee that you will pay him back is ultimately your house. It is probably worth a lot more than whatever you are doing to improve it. So if you cannot pay for work right now, try to postpone it until you can.

>>Which federal laws are applicable to remodeling projects?
>>What protection do I have once I sign a contract?
>>What kind of state and local laws apply to contractors?
>>What's the best way to guard against swindlers?
>>How do I find a reputable contractor?
>>Should I have a written contract with the contractor?
>>What should the contract include?
>>What should I watch out for when the job begins?
>>What can I do if the contractor violates the contract?

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