1. Home
  2.  → 
  3. Civil Litigation
  4.  → When do you pay a contractor? 

When do you pay a contractor? 

On Behalf of | Dec 23, 2020 | Civil Litigation

You bring on a contractor for your next development. They look at the project and give you a quote. It fits within your budget, so you tell them they’re hired. 

They quoted you the price, but when do you have to pay? Do you need to pay them upfront, or do you wait until the job is done to cut the check? Here’s what you need to know:

Every contractor has their own terms

The truth is that each contractor has their own terms and their own way of approaching billing issues. If you signed a contract with them, that contract should detail when payment is made and how much it should be. 

That being said, the typical process involves putting money down at the beginning and paying the balance at the end. For some, this means paying a full 50% upfront and 50% at the end. For others, they just need a small payment — say 10% — to get started, and they can collect the rest when they finish the job. 

This tactic is helpful because the real cost may come in above or below the quote. A small payment at the beginning shows good faith, and the final payment can be calculated based on the real final costs, not the assumed costs from the quote. 

What if there is a dispute over payment with your contractor?

As you know, issues with money often cause disputes. The contractor may think they’re owed money when they’re not, or the contract may not clarify some of the key points. When things get complicated and there is a lot on the line, you need to know your rights