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after final punch list, after you had all inspections from permits you pulled, after the property is under contract and buyers home inspector inspects it (I assume that too long to wait), or some other way
Kevin gave a great response. Just as important, never pay a contractor upfront for anything until after the first week of work is performed (at least for major jobs, some jobs are only a few days).
CO is obtained and ALL work is approved. A CO may be obtained without carpet and a few other items being completed, so be prudent. Good luck. If you want some Nike Air Force 1 Low Kids help with a contract, just ask here on BP. You receive suggestions, and they should be free.
it varies. You talking about a small job with a small time contractor. Most don have a lot of extra cash. Protect yourself on these deals. Lots of horror stories out there for people paying up Nike Force 1 Womens
Last Payment to Contractors
With that in mind, have your contractor word the pre agreed upon payment schedule in the contract. Let your contractor know up front verbally that your final payment will be 10% of the contract price and will not be paid until final inspection by city inspectors (or your own inspection). If he does not agree to this then you have to find another contractor or re negotiate. Just make sure whatever you agree upon is in writing and that your contractor is not violating any state laws.
Also, Kevin pointed out that you should receive a lien release from your general and any and all subs. This is very important!Jim Nike Air Force 1 Rose Quartz
You may want to check with your state contractor licensing agency to verify your states laws. Here in CA, the law requires a written contract for any home improvement project over $500.00. In the contract there must be a DETAILED, written payment schedule in the contract. The payments to the contractor cannot exceed the value of the work performed (with the exception of the down payment). Also the down payment cannot be more than one thousand dollars ($1,000) or 10 percent of the contract price, whichever is less, for a home improvement job.
Some dishonest people will ask for some ridiculous 50% upfront, that should be a red flag. never pay that kind of money upfront and if they want money for materials to start, have them give you the item list and then go pay for it at the store where the items will be purchased.
I am having contractors looking for payment before I am comfortable paying, so I want to know what recommended practice in this area is.
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On my TX subdivision, I pay 5K up front. This pays for permit, plans approval and water hookup. I normally pay approx 4 5 draws based on progress of home. Final draw is after Nike Air Force 1 Low Premium Id
Originally posted by Jim Stardust:The other one needs the money to order carpet from a wholesaler, I doubt he want me to pay the wholesaler myself?Why not? Are you guessing or did you demand such a process? YOU are the boss, not the contractor and as such, YOU dictate the terms, they can either agree or not get the job.
Originally posted by Jim Stardust:Rich, what kind of protections can you put in a contract if someone is willing to take the money and run?None. It makes no difference what you put in the contract, if you pay 50% up front and the contractor decides to skip town with your cash, you can only sue which will cost you even more money, the key is to avoid such a possibility in the first place which is why most of us experienced investors state to never pay anything large amount upfront.
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