How Much Deposit Can a California Roofer Ask For?

The salesperson is at your kitchen table. The roof looks good on paper, the price seems fair, and there is a pen in front of you. Then comes the line: "To lock in this price and get you on the schedule, we just need half today."

In California, that request breaks the law. This article explains how much a contractor can ask for a deposit in California, how the rest of the payments must work, how your 3-day right to cancel protects you, and the contract red flags to catch before you sign.

How much can a contractor ask for a deposit in California?

For a home improvement job, including a new roof or a reroof, the down payment can be no more than $1,000 or 10 percent of the contract price, whichever is less. Finance charges don't count toward the price.

Source: Business and Professions Code §7159.5; CSLB, Learn About Home Improvement Contracts

Here is what that means for real roofing bids:

For almost any full roof replacement, the most a roofing contractor can legally take before work begins is $1,000. And there is no exception for special-order materials, a story CSLB hears often. "The tile has to be ordered" doesn't change the limit.

The one exception is rare. A contractor with a blanket performance and payment bond on file with CSLB can ask for more up front. CSLB says only about two dozen companies have been approved for one, and it shows on the license record.

Source: CSLB, What should I look for in a contract

How the rest of the payments must work

After the deposit, the law says you pay as the job moves, not ahead of it. A progress payment can't be more than the value of the work done or the materials delivered so far. In plain terms: you never pay for a roof that isn't on your house yet.

A good contract has a schedule of payments tied to things you can see, for example:

• Deposit at signing, within the legal limit.
• A payment when materials arrive on your driveway.
• A payment when the tear-off and underlayment are done.
• The final payment after the final inspection, with a lien release in hand.

That last step matters. A supplier or subcontractor who isn't paid can put a mechanics lien on your home, even if you paid the roofer in full. California's sample contract has the contractor give you an unconditional lien release for each portion of the work you've paid for. Ask for it every time you pay. The guide's section on liens explains why.

Source: Business and Professions Code §7159.5; CSLB Sample Home Improvement Contract

Your 3-day right to cancel a roofing contract

If you sign a home improvement contract anywhere other than the contractor's place of business, which includes your own kitchen table, you get a cooling off period. You can cancel within three business days of receiving a signed, dated copy of the contract that includes the cancellation notice.

• Age 65 or older? Since 2021, you get five business days.
• Repairing damage from a declared disaster? The sample contract provides a seven day right to cancel for work on a home damaged by a sudden event for which a state of emergency was declared.
• How to cancel: in writing, by email, mail, fax or delivery to the contractor's business address, before midnight of the last day. Keep a copy.

Source: Civil Code §§1689.5 to 1689.14; AB 2471 (2020); CSLB Sample Home Improvement Contract

The contractor must hand you the cancellation notice with the contract. If it's missing, that tells you something about how the rest of the job will be run.

One exception to know: a "service and repair" contract under $750, for an urgent repair you asked for, loses the 3-day right once work starts. A full roof replacement is not that.

What a California roofing contract must include

For any home improvement job over $500, California requires a written contract. Before you sign, check that yours has:

• The contractor's name, business address and California contractor license number, matching the record at CSLB.
• The total price, the deposit and the schedule of payments.
• A description of the work and materials: brand, product line, color, and whether the old roof is torn off.
• Start and completion dates.
• The Mechanics Lien Warning and the right to cancel notice.
• Every blank filled in. Never sign a partly blank contract.

Changes after signing go on a written change order, signed before that extra work begins, with the price and its effect on the payment schedule.

Source: Business and Professions Code §7159; CSLB, Contracts and Binding Agreements

Red flags in a roofing bid

• A deposit over $1,000, or over 10 percent on a small job.
• "Cash only" or a discount for paying in cash today.
• Pressure to sign before the visit ends: "this price is only good tonight."
• No cancellation notice, or a cancellation notice with the wrong number of days.
• A payment schedule that front loads the money before materials arrive.
• A license number on the bid that belongs to a different company, or no number at all. (Here's how to check a contractor's license in California.)
• A roofer who arrives after a storm, offers to "handle your insurance," and wants a signature the same day.

Asking for too much up front isn't just bad practice. Under §7159.5 it's a misdemeanor, and it is one of the most common ways homeowners lose money to a job that never gets finished.

Questions to ask before you sign

"What exactly is my deposit, and is it within the $1,000 or 10 percent limit?"

"What work or delivery triggers each payment on this schedule?"

"Will you give me a lien release every time I make a payment?"

"Where is my notice of the right to cancel?"

The contract is only as good as the company behind it. Before you sign, it's worth checking that the roofer is licensed and insured, that the person qualifying the license is really involved, and that the workers' comp on file is current. A ConFacts report reads those records for you and gives you the questions to ask.

Frequently asked questions

How much can a roofer charge up front in California?

No more than $1,000 or 10 percent of the contract price, whichever is less. On a typical full roof, that means $1,000 at most.

Can a contractor ask for a deposit for materials?

Not above the limit. CSLB says there is no exception for special-order materials. Materials can be paid for in a progress payment once they're delivered.

How many days do I have to cancel a roofing contract?

Three business days in most cases, five if you are 65 or older, and seven for repairs to a home damaged in a declared disaster. Cancel in writing.

What if I already paid a deposit that was too large?

Keep your contract and receipts, ask the contractor in writing to follow the law, and contact CSLB, which takes complaints about excessive deposits.

Does the deposit rule apply to roof repairs?

Yes. It applies to home improvement contracts, and the 10 percent side of the limit is what usually applies to a small repair.

Read more about what to check before you sign in the Homeowner's guide.