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Question DetailsAsked on 4/10/2014

What is a reasonable % downpayment to a single contractor?

This is a bathroom tiling and tile repair job that totals less than $1000. The contractor asks for 100% of materials cost and 40% of labor cost upfront. Is this common or excessive?

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4 Answers

0
Votes

Paying for the material on delivery is not unusual and up to 50% at start for labor is not either

Every contractor is different but the materials should be paid for up front, if you do have a problem with the contractor and should you fire him he would have to go to court to remove them once they are on your property.

I work mostly on referals so I am a bit different. I am doing a tile job right now and since the homeowner bought the materials I have not recieved a dime and will get paid on completion. I guage what the deposit is on labor by the length of the job and the customer.


Don

Answered 5 years ago by ContractorDon

0
Votes

It sounds like your contractor might be straped for cash! I wouldn't think of asking a customer for a deposit on a job that $1000.00. You may want to keep looking or since it's a small job use the big box store and pay a little more at least if you have an issue you can go back to the store.


Best of Luck

Richard Jeziorski

Liberty Roofing & Siding Inc

Answered 5 years ago by LibertyRoofing

0
Votes

That certainly sounds WAY too high to me - especially for only a few day job. I would say cost of the tile and maybe 20-25% at delivery of tile (with vendor lien release) AND start of work would be fair.

Answered 5 years ago by LCD

1
Vote

Depends on the Job size .

IF the material is special Order , I ask for complete payment to cover the Special Order cost.

Then the labor cost is spread out over the job cost .

Usually , special Orders are NOT Returnable and therefore I ask the client to cover that cost as I feel should that client go to my supply store and order the material , My supplier is going to require the same Payment on Order. If the client complies , I consider the job to be in hand and work out the labor costs over the job course .


If the job is a lenghty contract , we will typically require a Deposit of 1/3 the job costs

with the Job cost balance being paid out over the job course. I have been known to require a deposit of 10% on contract signing , spreading the balance out over the course of the job .Our opinion is , IF One cannot pay for the job in incremental steps ,It Is NOT My job to finance it for you especially when the bank will not lend YOU the money, unless of course I am making a 50-75% proffit over and above the job costs !


What many forget, is that most contractors are NOT material stores and therefore are Forced to cover the standard material costs and break that cost up over the course of the job as well as the labor costs. Profits these days are limited to less than 5% and going

in debt only to be stiffed by a client is NOT A WISE IDEA ! I have seen MANY a contractor friend be put out of business simply because He granted credit to Bad client !!


Also , In these exceedingly trying times It is NOT uncommon for a Client to sign a contract , agree to the terms and Then , when the first payment is due as agreeded , REFUSE to make said Payment, saying I dont have any money to pay YOU ,SORRY !

A SORRY , does not pay any Bills ,Your's or theirs !

Then what you gonna do ? Shut the job down or continue to Grant the client credit ?

If the client can't make the payment within 10 days , we shut the job Down and head to court . Continuing to grant the Bad client more credit is detremintal to ones cause and only digging a deeper hole for all involved !

Answered 5 years ago by BentheBuilder




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