Business FinancesQuestion 1154 of 1605
On a home improvement contract, payments a contractor schedules and collects must:
a.Exceed the value of completed work to protect the contractor
b.Be paid entirely before any work begins
c.Always be collected in a single lump sum
d.Not exceed the value of work performed and materials delivered at the time of payment
Explanation
The home improvement contract law requires that progress payments not exceed the value of work performed plus materials delivered at the time of each payment. A contractor may not stay 'ahead' of the work by collecting for uncompleted portions.
Law Reference: Business & Professions Code §7159Practice all 1605 questions free — no signup required.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)