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Unfortunately, the remodeling industry is not immune to some of the scams that pop up every so often. However, if you use good sense and take some basic precautions you can avoid becoming a victim of these deceptions.

One scam to be aware of and avoid is when a contractor calls or comes to your house and offers to do remodeling work at a price that sounds reasonable. You're interested, but you can't afford it. He tells you that it's not a problem - he can arrange for financing through a lender he knows. You agree to let him go ahead with the project, and he begins work. After the contractor begins the work, you are asked to sign a bunch of papers.

The papers may have blanks that are not filled in or the lender may rush you through the process before you have time to read what you've been given to sign. You sign the papers. You realize later that what you signed was a home equity loan. The interest rate, and the points and fees you are being charged seem very high. To make matters worse, the work that was being done on your home is done poorly or isn't completed, and the contractor, who may have already been paid by the lender, has very little interest in completing the work to your satisfaction.

To protect yourself from inappropriate lending practices:

Don'ts

Don't agree to a home equity loan if you can't afford it.

Don't sign any document you haven't read and understood

Don't sign any document that has blank spaces to be filled in after you sign.

Don't let anyone pressure you into signing any document you are not comfortable with.

Don't deed your property to anyone without first consulting an attorney, a knowledgeable family member, or someone else that you trust.

Don't agree to financing through your contractor's lender without shopping around and comparing interest rates and loan terms.

Don't agree to a loan which includes credit insurance or other extra products that you don't want or need.

Don't let the promise of extra cash up front or lower monthly payments get in the way of your good judgment as to whether the cost you will end up paying for the loan is really worth it.

Do's

Do ask specifically if credit insurance is required. If it isn't required, and a charge has been included in your loan and you don't want the insurance, ask that the charge be removed from the documents. If you do want the added security of credit insurance, be sure to shop around for the best rates.

Do keep detailed records of what you have paid, including any billing statements and your canceled checks. Challenge any charges that you think are inaccurate.

Do read all items carefully. If you need an explanation of any of the terms or conditions, check with someone you know you can trust, such as a knowledgeable family member or an attorney.

Do consider all the costs of financing, including fees and closing costs, before you agree to a loan.

Learn more about avoiding potential home improvement problems by visiting http://easyhouseremodeling.com, a popular house remodeling website that offers information, tips and free house remodeling resources and home improvement advice.