Massachusetts Specific Guaranty
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FAQ
By law, the contractor cannot collect more than 1/3 of the cost of the contract in advance, unless special order materials are needed.
On private projects, Massachusetts Prompt Pay law requires property owners to make progress payments to Prime Contractors within 45 days after approval of invoice. The invoice must be approved or denied within 15 days.
Should I Give a Contractor a Deposit for My Home Project? It's normal for a contractor to ask for up to a third of the total project cost, except in California and Nevada, where state law limits down payments to 10% of the total estimated job cost or $1,000, whichever is lower.
It is a legally binding personal promise to step into the shoes of the original party to the contract. For example, an individual may personally agree to pay off the debts of a company they are acquiring as part of the acquisition.
In order for a guaranty agreement to be enforceable, it has to be in writing, the writing has to be signed by the guarantor, and the writing has to contain each of the following essential elements: 1. the identity of the lender; 2. the identity of the primary obligor; 3.
Any deposit required to be paid in advance of the start of the work cannot exceed one-third of the total contract price or the actual cost of any material or equipment of a special order or custom made nature, which must be ordered in advance of the start of the work to assure that the project will proceed on schedule.
The exact deposit amount contractors ask for upfront varies and is especially dependent on the size of the project. For relatively small jobs, like a $16,000 bathroom remodel, contractors may ask for a 50% deposit. For large jobs, like a $100,000 full-home renovation, a 10%?20% deposit is more typical.
Personal guarantees are usually enforceable. The typical route would be for the lender to demand repayment and then if payment is not received, to take legal action, to seek a court judgment and then enforce the personal guarantee.
