Legal Question in Construction Law in California

Re: contractor down payment

AMEN, Mr. Meyer; the requirement of law is very one-sided. Nevertheless, contractors have the ultimate weapon of the mechanic's lien, so I wouldn't shed too many tears for the contractors.

Re: contractor down payment

There is no down payment restriction on commercial projects.

The 10% maximum down payment applies only to contracts for home improvement.

I've researched this issue, and I'm of the opinion that the 10% cap still applies to the home improvement contract, EVEN WHEN that contract calls for thousands of dollars of materials to be ordered by the contractor. I think the legislature shifted the risk from the consumer to the contractor here. So my recommendation to contractors has been to make the homeowner purchase those materials directly from the vendor. That way, the contractor doesn't finance the purchase of the pre-fab materials, nor does the contractor accept a down pyament greater than 10% (or $1,000, whichever is less).