Building work - Money up front

[Stewart Towes]

I have had a quote from a newly established building company in my area for some building and roofing work that I want doing.The quote seems ok,the problem that I have got is that they want 30% up front for materials and for "insurance reasons".The company was in an article in the business section of my local paper,thats why I contacted them.For all you worldy people out there is it worth pursiung or should I not touch it with a barge pole? ???

[dig dug dan]

This is standard practice with some companies these days.

My neighbour is a landscaper, and askes for 25%. But this is more as a deposit.
What you have to bear in mind, is that by letting the builder start, he is "lending" you money in a round about way.
sometimes I have done a job, and had to go to court just to get paid. Some customers think they can get all their work done, the do a runner without paying
I am of course not suggesting you would do this, But I suspect this builder does not know you from adam, and cannot be sure you are a genuine customer. Until we start a job, we never know what a customer is going to be like to work for, or if we are going to get paid.
I never asked for a deposit, as all my work was recommendations, so I knew my customers were 99.9% sound. But now My website is easily found, I am getting what i call "yellow pagers" ringing, so a deposit means I can start, knowing that at the worst, it is only my labour costs I am up the swanee for.
By gettin a percentage up front, It secures the job, and gives peace of mind.
If you are at all worried, get some recommendations from the builder as to other jobs he has done, and speak to his other clients. If he is genuine, I am sure he wont mind this at all

[Tony McC]

Deposits and stage payments are normally used only on the more costly prokects, let's say anything over 5 grand. Personally, I object to any deposit of more than 10%, as until there are materials on site, the contractor will incur minimal costs. However, once materials are on site, I've no objection in principle to a stage payment of up to a further 40% so that, as Dan explained, the contractor isn't running an overdraft just to get your job done.

I do hope you've had the good sense to obtain more than just the one quote!

[Sean Buxton]

When I had some work done on the house, the payment terms were:

10% Advance, 2 off 30% Stage Payments and a final 10% upon completion. I thought these were reasonable as the builder has his cash flow to consider. The maximum advance I would expect to pay is 15% unless the builder has to purchase special material items that cannot be used on future work. If you handover 30% of price, there is less of an incentive for him to start work on your job.

[rms]

We usually ask for a 25% deposit when a customer decides to proceed with any work. If the materials make up a particularly high percentage of the cost this can rise to 50%. You have to do this otherwise sooner or later you'll land on your arse!

[Stewart Towes]

Thanks for the replies.Seems like I have a few things to consider.As you said Tony I hope that I obtained more than one quote.Easier said than done to be honest.I must have rang over more than twenty builders/roofers in the last year.Usual story,we are really busy,ring back in few months time,not interested blah blah blah.A few have called round,had a look scratched their chin said we will send an estimate through the post then not bothered.Out of them all,one wrote me out a price there and then.I thought that was a bit odd so I did not bother chasing that one up.

[rms]

If a contractor writes you out a price while on site it can mean one of three things....

The work is straight forward and simple to calculate.

The contractor has covered everything by keeping the price high.

The contractor knows his stuff and is bloody good!

Or most likely a bit of all three!

[Mick Leek]

Why dont you do a bit of DIY

I am building my extension, and up to now have done everything myself (apart from drive the digger)

Its great fun...

Mick.

[Mick Leek]

Why dont you do a bit of DIY

I am building my extension, and up to now have done everything myself (apart from drive the digger)

Its great fun...

Mick.

[Stewart Towes]

I think you missed the fourth point RMS.and that he may have been a cowboy.Certainly the two lads who turned up with him looked a bit desperate.Also Mick,I dont mind a bit of diy but this one is definitely out of my league.Thanks for the suggestion but I think I will leave it to the pros

[rms]

If your gut reaction tells you that something is not quite right then give them a miss. But if you get this feeling with everyone who looks? You'll have to chase up lots of references.

[rms]

Oh yes Stewart,

Like most of the contributors to this site, I'm far too busy to pick up on every point!

Not bad for free advice though!

[Stewart Towes]

Point taken rms.Like you say,not bad for free advice.Seriously though,the ones who I thought looked a bit dodgy were the only ones who I had misgivings about,the rest all seemed above board.Anyway I may be able to draw a line under this saga,we might have found somebody.So watch this space(an old cliche I know)and I will keep you posted.

[Stewart Towes]

Hello everybody,Hi Tony.Just thought that I would let you all know about our continuing saga of getting some building and roofing work done on our house.I am glad to say,after all the carry on of phone calls,people calling round,wild goose chases etc,we finally found someone willing to carry out the work.A local firm as it happens.I found their details on the FMB website.Dont know why I didnt look sooner.

[Tony McC]

Another satisfied customer!