California lawmakers introduce SB 784 to protect homeowners from deceptive contractors

A pressing issue of consumer protection took center stage during the California Assembly Banking and Finance Committee meeting on July 7, 2025, as lawmakers addressed the alarming rise in fraudulent home improvement schemes targeting vulnerable homeowners.

Assembly members highlighted the deceptive practices employed by unscrupulous contractors who mislead homeowners into signing loans for projects that are often incomplete or non-functional. These bad actors frequently target seniors, non-English speakers, and communities of color, leaving many drowning in debt and facing damaged credit. One assembly member recounted personal experiences from constituents who fell victim to these scams, illustrating the emotional and financial toll such schemes can take.

The discussion revealed a staggering 154% increase in complaints to the Contractors State Licensing Board since 2019, prompting the establishment of a new enforcement unit to tackle the surge. The tactics used in these scams have drawn comparisons to the subprime mortgage crisis, raising concerns about the need for stronger consumer protections.

In response, lawmakers are advocating for Senate Bill 784, which aims to implement essential safeguards for homeowners. Key provisions include requiring a confirmation call between lenders and borrowers before finalizing loans, ensuring that consumers do not pay for home improvement projects until they are confirmed as complete, and increasing transparency around hidden fees. The bill seeks to protect Californians from being burdened with debts for services they never agreed to or received.

The assembly member expressed a commitment to collaborating with banking institutions to refine the bill while ensuring it effectively distinguishes between reputable and fraudulent actors in the industry. With the support of witnesses from housing advocacy groups, the committee is poised to take significant steps toward safeguarding consumers and leveling the playing field for honest contractors and lenders.