Contractor wants 50% upfront - is that normal?

What a normal payment schedule looks like

Money should follow work that exists. A schedule tied to milestones rather than dates keeps both sides honest, because a milestone can be looked at and a date cannot.

1. 1A mobilisation deposit, modest, often around ten per cent or capped at the materials that must be ordered.
2. 2Demolition and rough-in complete.
3. 3Rough inspections passed.
4. 4Drywall complete.
5. 5Finishes complete.
6. 6Final inspection passed, punch list done, retainage released.

Some states cap the deposit a residential contractor may take. Ask what the rule is where you are before you agree to anything unusual.

What to insist on in the contract

• A written scope with allowances stated for every selection item.
• A draw schedule tied to milestones, not to the calendar.
• Lien releases from subcontractors and suppliers at each draw.
• Proof of licence, general liability and workers compensation — verified with the state and the insurer, not accepted as an emailed PDF.
• A real retainage held until the punch list is finished.

Why the big deposit is the red flag it is

A contractor who needs half your money before starting is either funding another job with it or has no credit with suppliers. Both are problems you will feel later, usually as a stalled site while they chase the next deposit.

An honest contractor will not blink at any of the list above. I certainly do not, and I would rather every homeowner asked.

Before you sign

Run the four checks in how to check a contractor is legitimate, and if the job is a whole-house remodel, decide early whether you are living in it. If you would rather hand the whole thing to someone who is licensed to build it, that is what I do.

How to say no without losing the contractor

Most contractors asking for a large deposit are not trying anything; it is how they have always done it. So make the counter easy to accept: agree to fund the materials that genuinely have to be ordered, against an invoice, and tie the rest to milestones.

• Offer to pay suppliers directly for long-lead items.
• Offer a milestone schedule with short gaps, so cash flow is not the objection.
• Ask for lien releases at each draw, which protects both of you.

If none of that is acceptable, you have learned something useful before any money moved.