How much money can a Maryland contractor require as a deposit? 5k on a 12k contract????

[Anonymous]

I am getting bids on rewiring our entire home. One bid came in at about 12k (which seems steep, right???) and that vendor wants a 5k deposit on a 12k contract. Is that legal? I'm on hold with the Maryland DLLR to see what they say but does anyone have experience with this?

I am from California where contractors can only charge a maximum of $1500 or 10% of the contract, whichever is more, as a start of work deposit. This is to protect the homeowners obviously from someone just cashing the deposit check but not ever showing up.

[Anonymous]

It was 1/3, 1/3, 1/3 when I did it.

[Anonymous]

I recently had a contractor in to do work and paid half up front. Talk to references and do research before handing the money over, but I don't think that is so uncommon.

[Anonymous]

We did 40% up front. Another 40 mid way (based in what is accomplished) and the rest when totally done.

[Anonymous]

5k isn't out of the typical range. Anyway, as long as they have an MHIC number, you're protected as MD will pay out if they go bankrupt and fail to deliver.

[Anonymous]

Op here, thank you. As long as we are in step with local business practices, I feel more comfortable.

[Anonymous]

Anonymous wrote:I am getting bids on rewiring our entire home. One bid came in at about 12k (which seems steep, right???) and that vendor wants a 5k deposit on a 12k contract. Is that legal? I'm on hold with the Maryland DLLR to see what they say but does anyone have experience with this?

I am from California where contractors can only charge a maximum of $1500 or 10% of the contract, whichever is more, as a start of work deposit. This is to protect the homeowners obviously from someone just cashing the deposit check but not ever showing up.

$12K to rewire an entire home, as long as you don't live in a one level shoe box, isn't that high. A new panel box alone can cost $1000. Then all the time to snake wires through walls. It's a time consuming process.

There is so much construction in the are that good electricians can go make good money on large scale commercial projects, working on military bases, etc. Remember you're also paying them for their time to go get the permit, which is time they aren't in your house wiring it.