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Updated over 5 years ago on . Most recent reply
Electrician Wants 50% up front
Flipping my first house and first time dealing with sub-contractors. The electrician that gave the best bid wants 50% up front. I balked at that and he said he can do 25% up front. He said he doesn't want to fund it himself and I told him that worries me if he can't fund a job this small. He said it's not that he can't, but he doesn't want to. I live 8 hours away from this job.
I'm using a rehab loan with a local bank and they have a draw schedule, which I doubt includes up front payment.
What is the standard?
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You dont trust him and he doesnt trust you . How does the contractor know that you are good for the money especially when you arent a local ? Why as a contractor should he finance your job ? Copper wire , breaker panel , permits arent cheap materials are close to the 50% he wants . Supply houses do offer credit , net 10 days usually then there is a carry charge after that . Then you have labor , so he gets the rough in done and has all his money out and has to wait till you get a draw ? Thats what he is avoiding .
I am a contractor , no deposit , no work , no exception . My funds are working for me in my investments , not the customers . If I have 3 or 4 jobs running and I am fronting materials , I could have 10's of thousands of dollars out . Then waiting for my money , not.... Thats not a contractors business , thats what banks do .