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Asking for a 500$ deposit for a 1200$ job.

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Posted by: from Montral
7/22/2012 at 11:19:46 PM

Hi,

I live in Montreal, and it seems like everyone hires the contractors working under the table, meaning the ones who charges cash only.

This contractor I spoke to, gave me his quote for my bathroom renovation job; 1200$.

He is booked 'til end of October; in order to guarantee my spot on his agenda, he asked me to put a 500$ deposit.

I found him via a wood carpentry shop, upon calling last summer, when I needed someone to repair the front door. The shop told me, although they don't offer such service, they highly recommend this guy and gave me his contact info. He did a fabulous job in repairing my door, but it was 100$ job. He didn't ask me for a deposit.

Although I still have a good intuition about this contractor's expertise and overall as a person, I am not comfortable about giving him 500$ in cash, 3 months before the job is scheduled to start.

I can understand him not wanting to protect himself from customers who might not have paid him properly in the past.

I was quite ready to hire him until he mentioned this deposit. He gave me 2 weeks to contact him.

He seems trustworthy, however, what if he gets sick and that he becomes unable to work on the date he reserved me?

He showed me pictures of a number of bathroom and kitchen work he's done, so I trust that he is an experienced home renovator; only he is doing this under the table, like most others.

I am thinking of negotiating with him, and bring down the deposit fee to somewhere around 200$. Still, I am taking a risk of giving someone a cash 3 months before the job start date.

Please let me know what your thoughts are on this.

Thank you!

REPLIES (17)
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Date/Time7/23/2012 at 12:06:03 AM

Never give cash like that to anybody. You can kiss it goodbye. The $500.00 is and indication he is a crook...Hire a good contractor pay a bit more and have piece of mind. If you always buy on Price you will pay twice.

Michael

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Agundiz Design Inco in Toronto
Date/Time7/23/2012 at 12:18:06 AM

Hi there,

As you know and your contractor knows there are alot of contractors out and asking for money in addvance before signing a contract is very risk. A lot of times the owner have the power to say, when I see you have done helf work I give you the $500 you asking and the rest when you finish and is 100% complete.

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Jeff from Newson Interiors in Dunrobin
Date/Time7/23/2012 at 12:23:06 AM

Legitimate contractors don't work cash deals. If you signed a binding contract to secure the date of the renovation a deposit wouln't be required until the job starts.

If an individual is willing to work for cash "under the table" to cheat the tax man, he's more than likely to cheat in other areas like your bathroom reno.

You are correct to be suspicious, shop your project around to a few legitimate contractors and see what they say.

Good luck.

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Date/Time7/23/2012 at 6:47:02 AM

There is a lot of things people shouldn't do. If you like the contractor , and feel Good about him, then

Do it, but for an amount you feel safe with. You might like him now, but may not later.

Always better safe then sorry.

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Date/Time7/23/2012 at 7:35:50 AM

Hi Nikki,

This is an easy one...

Do not pay anything to him 3 months away.

Do not enter into a cash job. I know it saves the client the HST, but it is cheating the tax man. If this is the only type of work (cash jobs) this guy does, then he is a crook.

I get asked all the time to do cash jobs. I tell my perspective clients that I can't do it, and alot of them call me back anyways to get the work done, and they are more than willing to pay the tax.

Plus, he gave you only 2 weeks to contact him? How does thaat seem trustworthy? It seems a bit strange to me that he has a deadline for getting customers.

Do some more homework and search for some reputable renovation businesses, you'll be happy you did.

Bill Clawsie

Clawsie Contracting

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Date/Time7/23/2012 at 8:07:35 AM

No, you will pay him the full price upon completion of the job. $1200 is not much. A good contractor does not ask for a deposit on small jobs, cheque or cash. On top of that you take a great risk with contractors that work under the table. They work for cigarettes and gas...not for quality and reputation.

Get a written contract for the scope of the work included in the $1200, the dates of start and completion and the paymnt to be made upon completion and satisfaction of the work.

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Date/Time7/23/2012 at 10:23:27 AM

Hi,

It s often common practice for contractors to ask for deposits to secure the project. In your case I would suggest that you have him prepare a written proposal for the work to be done. Within that document include a section for terms. The terms should be as follows: deposit of $ 100, upon commencement of the project give him $ 400 and then the balance on completion. Have him sign the contract. And you align as well if you have faith that he will do as he has promised, he will agree to this.

Whether you pay him in cash or cheque really is irrelavent. In the event that he doesn't show up to complete his obligation you have written proof to the deposit or worst case you lose $100. In any case get a written recipt for the money you give him.

If he is not willing to give you this document, then you should seek another contactor to renovate your bathroom.

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Date/Time7/23/2012 at 10:57:55 AM

Hi Nikki,

It's the old buyer beware thing. I never charge anything until I begin to work. There is no reason for the deposit as your man isn't holding any material for you, it's only his time that's in question.

I'd suggest that you simply say that you are not comfortable with the deposit and if this becomes an issue, find another contractor. ... Having said that, his fee sounds a little on the low side. Maybe shop around and see who esle is available and ask for estimates.

Good luck.

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Gaby from Amg Renovation in Hearst
Date/Time7/23/2012 at 6:23:44 PM

Hi,

Don't do that, tell him its to far first of all and never give a deposit for the labour, except for a special order, contractor that ask for deposit don't know how to manage there business and it smells troubles. ask to someone else if you are not comfortable with that, even if its cash get a permit and make his job inspected by a inspector PLEASE. you will save allot of trouble.

Gabriel

Certified Carpenter

Certified Inspector

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Date/Time7/23/2012 at 7:30:08 PM

I would never ask for that amount up front nor have I heard anyone else do that.

Ask him if he'd waive it or take much less and let him know of your concerns. If this is unacceptable to him you may just want to find someone else, besides maybe you wouldn't have to wait 3 months.

Good luck!

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Nikki in Montral
Date/Time7/23/2012 at 8:51:35 PM

Thank you everyone for such a prompt response.

I actually called him before reading your replies; I expressed him my concerns about handing advance 500$ 2.5 months before the start date and that the amount is a lot for me, and if there's other options he & I can consider. I also asked him if he has references.

His response:

I do this to save my agenda and to protect myself from people cancelling work at the last minutes. I get contracts worth 10K-20K to renovate houses, and I ask them upfront 10K deposit. Without this deposit, I cannot accept contracts. If I cannot start the job as per agreed, then of course, I'd give you the $$ back.

As for your reference, if you had a renovation job worth at least 10K, then I could have given you 10 customers to provide reference, however, for such a small job, no I don't give out references.

Of course, it's easy to say "I'll give you your money back."

Then I read all of your replies. Well, I've decided to go for other contractors who won't request for a deposit.

Thank you everyone.

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Sebastien from Accro Woodworking Ltd. in Airdrie
Date/Time7/24/2012 at 8:04:26 PM

If you trust him then i'm not to sure what the concern is.

Also i would be making sure that i received a receipt for my deposit, in case things do go bad you have proof that you gave him a deposit. If he wont give you a receipt then i wouldn't give him a deposit.

There is lots of capable companies out there, that will do it legally. Being payed in cash and not leaving receipts is not legal.

Hope that helps

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Gaby from Amg Renovation in Hearst
Date/Time7/24/2012 at 8:09:00 PM

Hi,

You did a really good thing there, he probably doesn't have some more jobs the way you explained it to us, doesn't mater if the job is 50$ or 200 000$ the client wants references you give it to them, right? the small job is also important to your client small or big he wants it done good, just the fact that he didn't want to give you references he was an ass............. and you did a good thing,

ALWAYS ASK FOR REFERENCES

IF HE HAS PICTURES

PERMIT

INSPECTION

Those should be a must for every client like you but some don't ask for it. and get in trouble, well you today you probably saved 500$,

Good job and let friends know about the must for clients.

Gabriel

Certified Carpenter

Certified Inspector

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Date/Time7/25/2012 at 5:30:19 AM

People love cash jobs. Personally, it's much too risky these days in our business with liability issues. If anything goes wrong, stuff will hit the fan. Yes it is more expersive to be legal, but more costly to get caught not being legal. If you're truly professional you're legal.

I always ask my customers to provide a deposit, usually about 30% just when I start the job to pay for my committment in providing materials and such. I understand that customers may say they will wait to hire you then change their mind and hire someone else. That's just part of our business.

Pay in progressive stages of the job. You'll both win that way.

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Date/Time8/4/2012 at 7:59:55 AM

HI,

We think the companies in General Contracting and private handy man have huge difference to perform business in very ethical way. Now a days cost of life is gone too up hard to afford every one. General Contractors with at least 5 year old reference with their work was done none any problem came up within two years will give you full mind satisfaction to even spend little more money with them

On other hand handy man what asking for.

Normally General have All the Licenses - Insurance - Bonds - Permits and if need inspections will do it will not cut any corner and result will be good if he is full General with Journey persons work with him.

Private handy man no problem hire him if we like his work and we still need his last 5 year reference - pictures does not says any thing unless handy man self working on each job and showing clearly he is working there and must be contact reference to ask , may be image with some other reputable companies and that happens all the time but if we like his work then get his family information just make visit to his place have coffee with his family and get to know each other and keep in touch with his family and pay cash to his wife actually and get receipt this way we can at least secure our 500 .

As mentioned its very hard to do cheaper job done but own piece of mind have to do little bit more efforts.

Hope that helps you if not let us know we will suggest you more and even can guide your project and make complete check list with you if you share use your bathroom images we can be found in Google Saskatoon storing hands connection.

Thanks

Amir Janjoa

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Syed Painting & Handyman Services in Brampton
Date/Time9/18/2012 at 12:31:53 AM

If a contractor is asking some money in advance it doesnt mean that he is crook. If you are signing the contract with all the information and terms and conditions on it then it should be ok to pay in advance. But I also think that for a $1200 job the advance shouldnt be more than $250.

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Date/Time12/17/2012 at 9:19:39 PM

It is really strange that the customer is asking this question here, on the official contractors website which checked all contractors and made sure that they have license... If you hire the "so called "contractor who is abusing the system and work under the table-it is not fair to us, licensed contractors and I am just speechless...

Imagine the picture: customer came to the government office with the complain-he paid cash under the table and the "under the table" contractor did not do a good job... What will be the government reaction???

They will ask for the name of this contractor and they will nail him if they catch him...

"Please let me know what your thoughts are on this" - ... hire licensed contractor, he will know what to do in accordance with the law in your province and you will have written guarantee from him.

In Alberta if contractor does not have PREPAID contractor's license he has no right to ask for any advances-it is a law!

My company has prepaid license and our contract is checked, approved and filed with the government.

For licensed contractors the advance depends on the materials cost. If $500 is cost for materials-then this is OK. Contractor does not have to spend his own money on purchasing materials.

Until every customer will hire contractors under the table nothing will change in the system, just will get worse and will bring more and more unhappy customers.

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