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Question DetailsAsked on 11/4/2016

What is the maximum percentage a contractor can ask for as a deposit before beginning the job?

A contractor I located sent me a contract via email. I have yet to meet him. His contract is for a refurbishing of a kitchen that was partially burned. My budget was exactly $4000. He is asking for $1500 in the contract and wants me to send it back via fax. I feel uncomfortable paying that as I don't even know him. He did send me his insurance document and I did speak to one reference which was good. Can you help me with this issue? Also, is there a maximum deposit payment to contractor law in Texas?

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1 Answer


I don't see why you would consider committing to a contractor or sending money to someone you have not met - which presumably also means he has not seen the jobsite - so how did he do his bid, ouji board ?

You are saying "your budget" is $4000 - is that what the contract amount is, or is this an open-ended cost-plus contract (BAD idea). About 40% is on the high side for a deposit, but if he is buying cabinets or appliances to replace then $1500 is not a lot. Course, $4000 is not much for a kitchen remodel either - must have been a VERY limited area affected, because normally $4000 would only cover 1-2 cabinet replacements and maybe a range and a room surface cleaning and repaint - not major damage.

Sounds to me like your bidding procedure is flawed or incomplete - he should first view the jnobsite and make necessaary measurements (and meet you), then provide the bid (with proposed contract if he wants - most contractors (unless they use a "form sheet" which is a bid form with an abbreviated ontract on the back to be signed and returned) submit the bid, then if the client says they can acceptthe price send a contract to be signed. You also said you talked to one reference (not knowing how reliable that reference is, because many scammers have a friend or employee act as a "reference") - did you check for Angies List or Yelp reviews on him ?

I can't get the Texas Attorney General website on residential construction contracts to open for me - if you can, might be something about it in there - but considering we are talking Texas here where a great many of the normal types of contractors are not even required to be licensed, I seriously doubt there is a maximum deposit law.

And remember - until HE also signs the contract (and you should get an original copy signed by both parties for your files) it is not a legal contract - so be sure you get your signed copy AND double-check that the terms are the same BEFORE work begins.

One othe thing - you did not say anything about him being bonded - or was that included in the "insurance" paperwork you got ? More on that here FI -

Answered 4 years ago by LCD

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