Angie Hicks really dropped the ball on this one.
In this article that was posted online earlier today, the founder of Angie’s List, Angie Hicks, gives advice on how to manage cost and reduce risk with a home improvement project; the only problem is her advice is a mission to Mars: great in theory…hard to put into practice.
The first thing she mentions is putting your bill on a credit card. This sounds like a smart idea because you can cancel the transaction if the contractor doesn’t do the work the way you want to. But you’re talking about putting thousands and thousands of dollars on a credit card. With the debt crisis in America being as high as it is, why would you want to risk it? Even if you have the money sitting in your account, and you are planning on paying it off as soon as you can, the fact of the matter is you’re still putting this giant purchase on credit and opening yourself up to the potential to have some pretty serious problems down the road. Plus not every contractor takes credit cards. Contractors are just as much at risk for having their homeowner not pull through on the payments as homeowners are for contractors running out on them. Besides how many Americans have high enough credit to really put $5,000 on their card?
Angie’s next bit of “advice” is to pay with a check. This too sounds good in theory because you’re not putting yourself at risk by using a credit card, and you’re using money that you know you have. But digging a little deeper this is actually worse advice than putting it on a credit card! When a business cashes a check, even a personal one from you, there is a 2-3 business day wait before the check clears, this is called a float. It’s a form of security that the bank gives so that you have an opportunity to cancel the check before the money goes through. However, when it comes to contract work a bad contractor can ride the float for two days until the check clears and then steal your money never to be heard from again. Granted you have a bit of a paper trail, but if your check already cleared and the money is already gone, than the paper trail doesn’t do you any good.
Angie does give good advice by saying never pay with cash, but you knew that already anyway. The main problem with her advice is the potential negative consequences for these types of payments FAR outweigh the benefits that they give. Just by using Safepact you get all of the benefits of using a credit card or check, with none of the negatives.
Using Safepact gives you the number one positive of both a credit card and check without any of the negatives or risk. You don’t need to call and cancel a transaction because the money is released only when you approve the work. You don’t have to worry about the potential for debt or a credit check because you already have the money in our account, and we don’t do credit checks. Plus, you don’t have to worry about paying it off with an added APR rate.
Just like a check, you automatically have a paper trail because you get update e-mails from us every step of the way. Not to mention our ability to upload your contract and provide our secure messaging system. There is no float or hold on your funds while a check clears because as soon as you approve the transaction, the money gets put into your contractor’s account. You also get the best benefit of using a check because as soon as you put the money in our account, it is out of your account the same way if you paid your contractor directly with a check, the transaction is just as instant.
The best part about using Safepact is the simplicity of a payment plan. The best piece of payment advice is always “never pay for everything up front, use a payment plan”. With Safepact you don’t have to worry about multiple checks (and multiple float days) or multiple credit card swipes (with their own float dates and billing periods). You just pay whatever amount you want to, whenever you want to, just by e-mailing us.
Trust us, we understand that finding out how to pay your contractor is one of the main hurdles of home improvement work. This is why we created Safepact, this is why we are set up the way we are, because of articles like this one. Besides, who would you rather take home improvement payment advice from? A person who runs a review website? Or a person who runs a home improvement payment website?
Everybody build (and pay) safe out there!