Contractors requesting deposit - is this standard?

[Jennifer Jacobs]

Hi Everyone,

What do you do when your contractor asks for a deposit?

My partner and I have always done our own rehab. The next project we are working on we can’t do ourselves and are looking to hire a contractor.

We’ve contacted several reputable companies and all of them are asking for a deposit of 25-50% up front.

Is this standard practice?

We’ve all heard stories from rehabbers who put down a deposit and never hear from the contractor again.

The companies we’ve contacted all have offices, professional websites, and several references that we checked.

I’m wondering how safe is it to give a deposit with a company that is established.

What has your experience been?

I understand from the contractors point of view they don’t want to do all this work and not get paid. But from the owners perspective it’s the same thing - they don’t want to pay out money for work that might not get done.

What is the best way to serve both parties so that they both feel secure?