How you pay for a remodel matters almost as much as how much you pay. A payment schedule tied to completed work keeps your money in step with progress, gives both sides clear milestones and works hand in hand with lien releases. This guide explains how to set one up.
Key takeaways
- Tie each payment to a completed, checkable stage of work.
- Collect lien releases as you pay.
- Keep proof of every payment in your project binder.
Why stage payments work
The Nevada State Contractors Board lists a detailed payment schedule among the items that may be advisable in a contract. Paying by stage means you pay for work you can see, inspection results you can check and materials that have arrived. It also gives the contractor steady cash flow for a well-run job.
Option A: large payment up front
Some contractors ask for a large share of the price before work starts. That puts the risk on you: if the job stalls, you have paid for work that has not been done. For pools, Nevada rules limit how much a contractor may collect up front, and the Board tells homeowners never to pay the full amount in advance.
Option B: payment by stage
A stage-based schedule sets a small initial payment and then pays as defined parts of the work are completed. The last payment comes after the final inspection and your walk-through. This is the pattern most consumer guidance favors.
| Large up-front payment | Payment by stage | |
|---|---|---|
| Your risk if the job stalls | High | Limited to work done |
| Link to inspections | Weak | Can follow passed inspections |
| Link to lien releases | Hard to match | Release collected with each payment |
| Clarity for both sides | Low | Each milestone is defined |
A sample stage schedule
- A modest initial payment when the contract is signed.
- A payment when demolition and rough framing are done.
- A payment after rough plumbing, electrical and mechanical pass inspection.
- A payment when drywall, cabinets or tile are installed.
- A final payment after the final inspection, your walk-through and the punch list.
Every project is different. The point is that each payment matches something both of you can see and verify.
Pair payments with lien releases
The Board suggests requiring the contractor to provide unconditional waiver and release forms, so that when you pay for a completed phase, the subcontractors and suppliers for that phase sign releases. It also suggests asking for partial releases for partial payments and a final release for the final payment. See Mechanic’s Liens and Lien Releases in Nevada.
Tip: Never pay in cash without a signed receipt. The Recovery Fund requires proof of payments, such as front and back copies of checks, receipts and bank records.
Other payment protections
The Board describes a few more options: joint checks payable to the contractor and a subcontractor or supplier who sent you a preliminary lien notice, and fund control services that pay the contractor through vouchers for a fee. On larger jobs you can also ask about a payment and performance bond.
Holding back part of the final payment
The Board suggests discussing with the contractor whether to withhold a portion of the payment until the period for filing liens has passed. The amount should be enough to cover possible claims and agreed with the contractor in writing.
Before the final payment
The final payment is your strongest point of leverage, so make sure the job is truly finished first. The Board recommends a final walk-through and a written punch list of minor work to complete or repair, with no verbal agreements for repairs or extra work. Confirm the final inspection has passed, that you have warranty papers and manuals, and that you have final lien releases. The Board also advises not making the final payment until any liens filed against your property are removed.
Record every payment
In your binder, keep a table with each payment, the date, the stage it covered and which lien releases you received. Keep copies of checks and bank records. This makes it easy to answer questions later and is exactly the documentation the Board asks for in a Recovery Fund claim.
Common mistakes
Paying ahead of the work, paying for materials not yet delivered and making the final payment before the punch list is done are the most common mistakes. Another is paying without collecting lien releases for the work covered.
Frequently asked questions
Is a deposit normal?
A modest initial payment is common. A large share of the price before any work starts is a warning sign.
Can I pay by credit card?
Some contractors accept cards. Whatever the method, keep records of each payment.
What if the contractor asks for more money mid-project?
Only pay for changes documented in a signed change order. See Change Orders: How to Handle Changes Mid-Project.
Put the schedule into the contract using What a Nevada Remodel Contract Should Include.