Payment schedule for builder

[Cresswelle]

Need some assistance with agreeing the payments with our builder pls. 
 We’re having a side extension and a Hip to gable loft conversion with rear dorma and work starts mid feb. He’s just sent his payment details over and we need to go back with a proposal. He has asked for £18k upfront (mid feb) and then a further payment of £22k before 1st March. Next payment of £20k before 1st April and then final payment of £5k on completion. 
 

im obviously not going to agree to this and need to get something that minimises risk for us whilst still keeping him happy. He is a small company and this is prob why he’s asked for such large payments upfront. 
 

we want to pay in stages as soon as work

Is complete ie foundations in, roof structure done for loft but not sure what to propose as his quote isn’t broken down so don’t know individual charges. 
 

any help would be appreciated. Thanks 
 

 

[Bored Shopper]

a schedule of weekly payments with a reasonable upfront deposit and a retention amount.

Invoices to be issued on a Friday to cover the work done that week (demonstrable and provable). If work is not done as planned, reserve the right to reduce weekly payments or not pay at all if you are not satisfied with the progress.

Who is purchasing the materials - you or the builders?

 

[Cresswelle]

He is providing all

materials 

[Bored Shopper]

then keep checking that the materials are provided and delivered to site, and watch out for any delays in procurement.

[Cresswelle]

It’s just made me very nervous that he seems to think £40k within 2 weeks is the norm but if we can’t agree then best to walk away 
 

[PeterW]

Have you asked him why ..? And how about offering to pay the supplier invoices direct to manage the cash flow. Also means you’re the owner of the goods outright. 

[Cresswelle]

I haven’t responded as yet just said I’ll look it over. He has said if we need to tweak anything then we can discuss. We’re gonna sit down tomorrow and work

out what we’d be happy with but prob something along the lines of 10%
deposit, then stage payments and then final 10% on completion 

[Temp]

If you really hate this aspect of building you could pay a Quantity Surveyor  to take over the task. You could ask him to visit each month to value the work done and tell you how much to pay the builder that month or some similar schedule. He would ensure your payments went getting too far ahead or behind. 

 

The down side is they aren't cheap. Might add 10% to the build cost.

[Cresswelle]

Thanks for that. We’re on a tight budget really and I’m pretty happy dealing with the builder. Jus don’t know what the norm is. Loads of advice online just with us doing 2  lots of works together or the extension

and loft not sure what the exact order should be . 

[Temp]

You might consider linking some to sign off by Building Control. 

 

Groundworks - Foundations and drains completed and approved by Building Control.

Walls - Completed to roof level and approved by Building Control

Roof - Structure complete and tiled and approved by Building Control.

Completion etc

[recoveringbuilder]

Sorry but I wouldn’t be paying anything upfront, we went with a small builder and we bought all the materials, we didn’t pay anything until the foundations were in and blocked up to floor level, after all he will be paying his men in arrears so no need for money upfront, he will also have an account at his builders merchant which will be invoiced at the end of the month. You just hear so many horror stories!

[Cresswelle]

Thinking something along these lines for starters. Obvs if he thinks the payments are wrong he can come back and we can negotiate from there 

 

Deposit: 10% to be paid Friday before work begins 

Ground works and extension base-start mid feb. - 20% on completion

Scaffold, gable wall, loft structure-end of feb. 20% on Completion

Extension walls built, roof complete, scaffold down, lower roof constructed-March. 20% on completion

Electrics and plumbing-late March.  10% on completion 

Plaster, electric and plumbing early April 10% on completion  

 

10% on completion/sign off from BC 

 

thoughts? 

[recoveringbuilder]

Still can’t see why a deposit is required?! 
I ordered a new set of doors couple of months ago, no deposit taken, doors were fitted December 23rd and invoice left for me to pay at my convenience, I’m really not comfortable with paying upfront for any building work.

[Cresswelle]

Suppose depends what the deposit is for. If it’s for materials then agree should have necessary credit in place. Few things to ask him 

[Temp]

If you want/need to help with his cash flow the best thing to do is buy materials like the concrete in your name for delivery to your site. We did this for some windows. Make sure he is happy with the price you are paying before ordering because you're going to deduct that from the next stage payment.

[Temp]

Some builders merchants may also be prepared to give you an off the record comment on your builder.

[Cresswelle]

Thank you 

[epsilonGreedy]

34 minutes ago, Cresswelle said:

thoughts?

 

 

Essential that payments are tied to completed stages as shown in your revised payment schedule. One BuildHubber got caught out paying the builder a monthly appearance fee.

 

I would just caution about your relative percentages for the stages, in general for a whole house build a water tight shell is just a little over the halfway point whereas with your budget you have paid out 70% at this point.