12 Red Flags That a Home Service Business Isn't Who They Say They Are

A home service business is not who it says it is when its license, insurance, address or reviews cannot be checked by someone other than the business itself. Here are 12 red flags, each paired with the check that settles it.

The 12 red flags

1. No license number, or one that does not match. Search the number on the state board's site. In North Carolina, the General Contractors board states a license is required when the total project is valued at $40,000 or more; other trades have their own boards.
2. The name on the truck, the contract and the license differ. Ask which legal entity will receive your payment.
3. No certificate of insurance. Ask for it, and confirm it with the insurer or agent.
4. No workers' compensation answer. North Carolina requires coverage for businesses with three or more employees. Ask how injuries on your property would be handled.
5. Pressure to sign today. Real prices survive a night's sleep.
6. A large deposit or cash only. Pay on a schedule tied to completed work.
7. A blank or vague contract. No named materials, no scope, no start date, no change-order rules.
8. No local address. A PO box or a different state phone number is a warning.
9. Reviews that read the same. Identical phrasing, a burst of reviews in a few days, or no detail about the work. The FTC's rule on consumer reviews, effective October 21, 2024, prohibits fake or false reviews and testimonials, so businesses that buy them are breaking federal rules.
10. No references for work like yours. A bathroom specialist is not automatically right for a roof.
11. They skip the permit. A contractor who suggests avoiding the permit is telling you how they work.
12. The price is far below every other estimate. A bid much lower than the rest often excludes scope you will pay for later.

How to run the check in 15 minutes

• Look up the license on the official state board site.
• Request the certificate of insurance and confirm it.
• Search the business name with the city and the word complaints.
• Read reviews for patterns across unrelated customers, not the average.
• Ask for the full scope, price, schedule and warranty in writing. Our guide to roofing contractor warranties shows what a warranty should say.

After severe weather the same checks apply with more urgency; see our guide on choosing a storm damage restoration company.

What a published standard looks like

Handvetted publishes four checks on its standards page: an active license confirmed through official registries, background screening of every owner and operator, verified ratings of 4.5 stars or higher, and human approval of every application. One verified professional is matched to your request. The service is free for homeowners.

FAQ

Source note: NC Licensing Board for General Contractors; North Carolina workers' compensation requirements; FTC 16 CFR Part 465. Checked October 10, 2026.

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