A deposit does three jobs: it covers materials you’re about to buy, it filters out customers who were never going to commit, and it turns “probably” into a date on the calendar. Most contractors under-use them — either asking too little, or asking correctly and then making the payment itself so awkward it never lands.
Typical ranges (and the logic behind them)
| Job type | Common deposit | Why |
|---|---|---|
| Service / small repair | None, or trip fee | Payment on completion is the norm; a deposit adds friction the ticket doesn’t justify |
| Equipment replacement (water heater, AC changeout) | 30–50% | Covers the unit so you’re never financing the customer’s equipment |
| Multi-day projects (re-roof, repipe, panel + rewire) | 10–33% up front, then progress payments | Milestones keep cash aligned with work: e.g. a third to schedule, a third at material delivery, balance at completion |
The pattern underneath: the deposit should roughly cover what you’d lose if the customer vanished the night before the job — materials ordered, slots turned away. More than that starts to feel like risk to the homeowner; less means you’re the one carrying it.
Check your state before you pick a number
Deposit caps are real law in some places. The famous one: California limits home improvement contract down payments to $1,000 or 10% of the contract price, whichever is less. Several other states regulate deposit size or require specific contract language for home improvement work, and licensing boards enforce it. Two minutes on your state licensing board’s site is cheap insurance — and “our deposit follows state law” is a trust line your competitors can’t fake.
Put the terms on the estimate, not in a conversation
The deposit conversation goes best when it isn’t a conversation. Print it on the estimate: “50% deposit schedules the job; balance due on completion.”Attached to a signature line, it stops being a negotiation and becomes a checkout. Nobody haggles with a form.
Collection method decides whether you get paid
Here’s the quiet killer: a homeowner says yes on Tuesday, and the deposit arrives “whenever we’re both home for the check.” Days pass; enthusiasm cools; sometimes the job quietly dies in the gap. The fix is making payment part of the acceptance itself:
- Best: a pay button on the estimate — customer signs and pays the deposit by card in the same two minutes. The yes and the money arrive together.
- Fine: a payment link texted immediately after they accept.
- Weakest: “bring a check to the job.” You’ve turned your schedule into an unsecured loan.
Card fees sting until you price them against the alternative: one no-show with materials on your truck costs more than a year of processing fees. (This is exactly how Toolbelt wires it — e-sign and deposit on the same estimate link, money straight into your own Stripe account, invoice marked paid automatically.)
The short version
- Size the deposit to your real exposure — commonly 30–50% on equipment jobs, staged draws on big ones.
- Check your state’s cap before you standardize.
- Print the terms on every estimate.
- Collect at the moment of yes, by card, not later by check.
A signed estimate with a paid deposit isn’t a lead anymore. It’s a job. Build your paperwork so that’s the default outcome.