Nick Perry proposes the DDFC method instead of paying contractors 50% upfront: 15% deposit, 25% when demolition starts, 30% when permits are secured, 30% on completion. This staged approach protects your money while keeping the contractor motivated.
If a contractor ever asks you for 50% upfront, don't pay them. See, we've hired tons of contractors for our properties, so try use the DDFC method to get the best work. The first D is for 15% deposit because you want to show them you're serious. The next D is for demo. You want to pay 25% when the demo is started so they can handle dump fees and get the ball rolling with the cash flow. Then F is for forms. You want to pay 30% when forms are set so that they pay their carpenters, buy more material, and ensure everything is running smooth. Finally, C is for complete. You pay them 30% when the job is complete to your satisfaction. Of action. So next time you hire a contractor, remember
