Utah sets no legal cap on what a contractor can ask for as a deposit. Thirteen states do cap it, some at ten percent, some at a third of the contract. Utah is not one of them. So the honest answer to how much a contractor should ask for is that the number by itself will not tell you whether you are safe, and I say that as somebody who takes fifty percent up front on every job.
What the law actually says here
California and Nevada cap residential deposits at ten percent or a thousand dollars, whichever is less. Maine, Maryland, Pennsylvania, Tennessee and several others cap at a third of the contract. New York and Texas allow any figure but require the money to sit in escrow or a trust account.
Utah has none of that. A contractor here can ask for whatever the contract says, and a homeowner who agrees to it has agreed to it. That puts the responsibility somewhere else, and it is worth knowing that before you start comparing percentages between bids.
What we take, and what it pays for
Fifty percent at signing, on every project, whatever the size. I take fifty percent on a hundred and fifty thousand dollar job without hesitating, and I will explain exactly where it goes.
It buys material. It lets subcontractors be committed to firm dates instead of provisional ones. It means we are not financing your project out of our own working capital. And it covers overhead through the stretch between signing and the first milestone draw, because a business carries daily cost whether or not a payment arrived that week.
The rest is divided across milestone draws written into the contract, with five thousand held back until the punch list is done. The full structure is in how a contractor payment schedule actually works.
Is there a deposit figure that should worry you?
I get asked this and my answer disappoints people. No, there is not.
I have heard of contractors taking eighty percent before they start, and I would not call that wrong on its face. From a business standpoint you have to take a deposit. Material has to be bought, trades have to be booked, and somebody is funding that gap between the contract being signed and the first draw arriving. If the homeowner is not carrying it, the contractor is, and if neither of them is, the subcontractors usually are.
The one that would make me ask questions runs the other way. If a general contractor offers to do your remodel with no money down, I would want to understand how the work is being funded before I felt reassured by it.
What should worry you instead
Since the number will not tell you, here is what will.
Whether the contractor is licensed, and whether you checked rather than asked. Whether there is a written contract. Whether the payment schedule is in that contract, with the milestones and amounts set before anybody starts, so no payment arrives as a surprise. Whether the scope is detailed enough that both of you would describe the finished job the same way.
Fifty percent to a licensed contractor with a written contract and a payment schedule you can read is ordinary. Ten percent to somebody with no license, no contract and a verbal promise is a much worse position to be in, and the smaller number is doing nothing to protect you.
Why this matters more in Utah than it did last year
Utah used to run a fund that could reimburse an unpaid subcontractor when a homeowner had done everything right and got liened anyway. The Utah Department of Commerce announced in June 2026 that the fund is depleted.
The protection for homeowners survives, but it only reaches you if you contracted in writing with a licensed contractor and paid in full. There is no longer a fund sitting behind a bad choice. So the licensing question and the written contract question, which used to be good practice, are now most of the protection you have. We went through what that means in what a lien waiver is and why a homeowner should care.
Where the money physically goes in the first two weeks
It is easier to judge a deposit when you know what it is doing, so here is the honest sequence on a basement finish.
The permit gets filed, and in most Northern Utah municipalities that is a minimum of two weeks before approval comes back. Cabinets get ordered first, because standard cabinets run about two weeks and semi custom can run six or more, and nothing downstream can start until they land. Tile, engineered marble and the rest get ordered against their own lead times. Subcontractors get committed to actual dates rather than being penciled in.
None of that happens on credit. We do not order material until it is paid for, which is a rule rather than a preference, and it is the reason a deposit converts directly into a start date instead of sitting in an account.
What a deposit does not buy
It does not buy you a start date on its own. Ordering cannot begin until selections are made, so a project can sit paid for and still not move, and that is the most common way a homeowner loses weeks without anybody doing anything wrong.
It also does not buy the material outright. On our contracts a client owns installed material. Product sitting at a supplier or stacked in a garage has been paid for as part of the contract, and it becomes yours as it goes in. That distinction rarely matters, and it matters enormously in the rare case where a job stops partway.
There is more on the selections timing in when you have to pick tile, cabinets and countertops.
Nobody has ever pushed back on ours
In all the residential work we have done, not one client has argued about the deposit. I do not think that is because we are persuasive.
Somebody who has a problem paying a deposit on a home remodel is usually not in a position to be doing the remodel yet, and that tends to surface in the first conversation rather than at signing. We talk about budget openly before there is a contract, and if the money does not cover the scope, we change the scope. By the time a deposit is on the table, the affordability question has already been settled.
Comparing deposits across bids
If you are holding three proposals, the deposit percentages are close to useless as a comparison. A contractor asking twenty percent with a vague scope and no payment schedule is offering you less protection than one asking fifty with both.
What is worth comparing is the whole payment structure. How many draws there are, what triggers each one, whether anything is held back at the end, and whether all of that is written down before you sign. A schedule that gets invented as the job goes along is the thing to worry about, whatever it starts at. We went through how to compare proposals fairly in whether you should get multiple bids before hiring a contractor.
Before you hand anything over
Check the license yourself on the Utah DOPL database. Read the payment schedule in the contract and make sure the milestones are specific. Ask what the deposit is being spent on, and expect a specific answer rather than a general one. And ask whether they will provide lien waivers from their subcontractors and suppliers, which most contractors will not offer unless you ask.
More on the rest of that check in the red flags worth catching before you sign.
