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When to Pay Home Remodeling Contractors

Pay Home Remodeling Contractors Only after Passed Inspections

By Mark J. Donovan

When it comes to paying home remodeling contractors always remember the “Golden Rule”. Those who have the money rule. Repeat this maxim to yourself at least once a day during the life of your home remodeling project. By doing so, you’ll save yourself money and a lot of heartache.

Paying Home Remodeling Contractor Deposits

As part of most home remodeling projects a deposit is necessary to line up the home remodeling contractor.


The size of the deposit requested by home remodeling contractors varies greatly, however expect to hear a figure of somewhere between 10 and 50% of the total costs of the project. This does not necessarily mean you have to accept the home remodeling contractor’s deposit proposal. These deposit estimates are simply what you can expect to hear. I would highly recommend negotiating and capping the deposit to know more than 25% of the cost of the entire home remodeling project.

Home Addition Bid Sheets


Paying the Home Remodeling Contractor for Incremental Work Completed

As part of your home remodeling contract, there should be a payment schedule included based on incremental work completed and inspected.

Always hold off paying a home remodeling contractor until you and the local building inspector have inspected and approved of the work. When personally inspecting the work completed, make sure it complies with the home remodeling plans. The local building inspector will also be checking to see if the home remodeling project is being built to plans, but will also be inspecting the project for building code compliance. The building inspector, however, will not be inspecting the quality or craftsmanship of the work performed.

Only pay home remodeling contractors after the work has been properly inspected and approved.

Photo by Mark Donovan


If the completed work complies with the home remodeling plans and the local building inspector signs off on the work, then you should make the next incremental payment to the home remodeling contractor as specified in your contract.

You should not hold off payment if you are unsatisfied with an aesthetic issue associated with the work. Instead, your best course of action is to make the payment to the home remodeling contractor and discuss separately addressing the aesthetic issue. Keep in mind that it may cost you more to have the home remodeling contractor address your aesthetic concern.

Failing to make an incremental home remodeling payment to a contractor after the work has been successfully inspected is a sure way to submarine your home remodeling project.

So though it is important to remember the Golden Rule, it is also just as important to follow your contractual obligations. The last thing you want is to see your home remodeling contractor walking off the job and slapping a mechanics lien on your home.

Again, communication and open dialogue is your best course of action if you have concerns with the work being performed. By living up to your legal obligations and communicating constructively with your home remodeling contractor, your odds of having your home remodeling project completed successfully are dramatically improved.

To obtain accurate and consistent home building contractor quotes, see my Home Addition Bid Sheets. They provide a request for quote section that you can provide to prospective home building contractors. It also includes a comprehensive cost breakdown table, in Microsoft Excel format, that allows the home building contractor to include their projected home building costs for every phase of the project.


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