Contractor Wants a Big Deposit? Check
The quote is great, the contractor is charming, and he needs half upfront 'for materials.' Then he vanishes — or the work is shoddy and he is gone with the balance. Contractor deposit scams spike after storms and during renovation booms. A big upfront deposit is the reddest of flags.
TL;DR / Quick Fix
Quick fix: never pay a large deposit upfront — reputable contractors ask little or nothing down, with payments tied to milestones. Get everything in writing, verify the license and insurance yourself, and never pay cash. If a contractor pressures you to decide today, walk away.
Follow these steps
- Cap the deposit. A small deposit for custom materials is normal; half upfront is not. Tie payments to completed milestones in a written contract — see marketplace deposit red flags for the same instinct applied to goods.
- Verify license and insurance yourself. Look up the contractor's license with your state or local authority; call the insurer to confirm the policy is active. Do not trust a photocopy handed to you.
- Get three quotes. Scam quotes are often suspiciously cheap — the low bid buys your trust, then the deposit. Three quotes reveal the real market price.
- Insist on a written contract. Scope, materials, timeline, payment schedule, warranty — in writing, signed. Verbal promises evaporate with the contractor.
- Pay traceably, never cash. Check or card creates a paper trail; cash creates a ghost. Milestone payments by check also slow down a scammer's exit.
- Check references and recent work. Call past clients and, if possible, see finished jobs. A contractor with no verifiable history is a contractor you have not verified.
What NOT to do
- Do not pay a big deposit 'to lock the schedule.' Scheduling pressure is a sales tactic, not a business necessity.
- Do not hire door-to-door contractors after storms. See storm-chaser red flags — the knock is the business model.
- Do not skip the license check because he 'seems honest.' Honesty is unverifiable; licenses are.
- Do not pay the final balance before final inspection. The last ten percent is your only leverage — spend it wisely.
Frequently asked questions
What is a reasonable deposit?
Small — often ten percent or less, or nothing until materials arrive. Anything approaching half upfront deserves hard questions and, usually, a pass.
The contractor wants cash for a discount — okay?
No. The 'discount' buys you zero recourse when things go wrong. Traceable payment is worth more than any cash discount.
He started work then demanded more money — what now?
Stop payments, document everything with photos, and consult a consumer attorney or your state's contractor board. Do not pay ransom-style demands mid-job.