The deposit cap
California limits the down payment on a home improvement contract to 10% of the contract price or $1,000, whichever is less. This applies regardless of material cost, and progress payments must not exceed the value of work performed plus materials delivered.
Three-day right to cancel
The homeowner may cancel without penalty until midnight of the third business day after signing. The notice of cancellation must be given to the buyer in writing at the time of signing, and the contract must state the deadline date.
Required notices
- Mechanics lien warning in the statutory form
- Contractor licence number and CSLB contact information
- Approximate start and completion dates
- Full description of the work and materials
- Any arbitration clause disclosed separately and initialled
Getting it right without a lawyer on retainer
Roofsy Pro generates California-compliant contracts from your estimate: the deposit is automatically capped, the cancellation deadline is calculated and printed, the lien warning and arbitration block are inserted, and the homeowner initials arbitration separately before signing.
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Frequently asked
- Does the deposit cap apply to material-heavy jobs?
- Yes. The cap is on the down payment; you recover material cost through progress payments as work proceeds.
- When does the three-day clock start?
- At signing, counting business days, expiring midnight of the third.
- Is arbitration enforceable in a California home improvement contract?
- It can be, if disclosed clearly and separately acknowledged by the homeowner.