I’m getting some building work done, I’ve had a detailed quote (item by item) that I’m happy with and I’ve appointed the builder.

The sum is ballpark £30k so significant and I was wonder how best to manage payment.

I was thinking a small sum up front (£5k) to help with his cash flow then him invoicing me every couple of weeks for work done which I can of course check is done to my satisfaction and any deviation from the quote is justified.

This would seem fair?

Or are there other ways?

Maybe pick milestones in the job for which they receive payment rather than just fortnightly?

Make sure you retain a significant percentage you reckon reflects profit for him that’as not paid until completion and all snags have been addressed.

You should expect to agree a payement schedule based on work completed and an agreed final payment upon satisfactory completition. You should agree a ‘snagging’ inspection day where you inspect everything done and agree what needs to be put right. On completition check its been done and pay the final sum.

Yes I was wondering about that – how do you withhold an amount though if you are giving them something up front and then paying every fortnight or on milestones etc?

edit: makes sense now I’ve seen post above!

1. damo dont pay by time you pay by work completed.

2. My fault should have said this first. You have a detailed quote – how you asked a separate builder to do the same job? I would ask 3 to bid cost the job and then down select from that based on quote and warranty/time. This is normal commercial practice and ensures you get best price.

3. You agree the schedule up front by work completed. Dont agree a %. If the drive is laid and completed its done and you pay. Why?
This limits your risk in case they dont complete something. You dont pay and get someone else to do the work and pay them when they complete.

Its your responsibility to check the work done. You have a detailed quote. Standards – they should provide a warranty with their work. Ask to see it.

Final payment agreed in schedule after you identify the snagging and they complete the work. Job done full and final settlement payment.

Thanks, that’s helpful.

We’re in the same boat.. am waiting for the 3 quotes to come in this week for our rear extension/loft conversion.. i’m not expecting much change from £70k.

I’m intending to put together a milestone plan based on works completed, but also linked to building control sign-offs, so important bits (foundations/structural steels/etc) are signed off by a third party before I release payment.

I’m going to hold 10% back as a final snagging retention aswell.

Normal practise for payment to us as a Building contractor is no money up front ( but this would be nice 🙂 ) and payments on work completed to date on a fortnightly or 4 weekly period with a 5% retention till completion. This is then reduced to 2.5% on the agreement of practical completion or when you start to use the area for beneficently occupation this is retained for the defects liability period of 6 month to a year. If you hold back 10% this probably makes up the sum total of his profit on the job and we would not agree to these terms before starting. Just a small thing to remember Builders make the majority of there money on variations to the works so get them costed before he proceeds.
Hope this helps

Excellent advice from seahouse – all in accordance with generally accepted building contracts. Only minor point I would add is try for a 12 month defects period as this will encompass a full heating season – useful to test the heating plus drying out shrinkage cracks tend to manifest themselves during this time.