Good to know
How big can the down payment be on a home improvement job in California?
On a home improvement contract in California, the down payment cannot be more than $1,000 or 10 percent of the contract amount, whichever is less, and apart from the down payment the contractor cannot ask for or accept more than the value of the work done or the materials delivered. Neither limit applies to a contractor who furnishes a performance and payment bond, a lien and completion bond, or a bond equivalent or joint control approved by the registrar, covering full performance and payment. What a home improvement contract must say, and when it must be in writing, is set out in California Business and Professions Code sections 7159 and 7159.5.
The detail
The payment rules
- Down payment: no more than $1,000 or 10 percent of the contract amount, whichever is less.
- Payments after that: never more than the value of the work done or the materials delivered.
- The exception: neither limit applies to a contractor who furnishes a performance and payment bond, a lien and completion bond, or a bond equivalent or joint control approved by the registrar, covering full performance and payment.
Source: California Business and Professions Code §7159.5 (home improvement contract payments)
The contract itself
What a home improvement contract must say, and when it must be in writing, is set out in California Business and Professions Code sections 7159 and 7159.5.
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