How Much Deposit Can a Contractor Ask For in Vermont?
Vermont caps the down payment a registered residential contractor may require on a fixed or maximum-price job at one-half of labor cost or one-half of materials price, whichever is greater.
Vermont is one of the few states that sets an explicit ceiling on the deposit a contractor may collect for residential work. Under the Residential Contractors chapter, a registrant working under a fixed or maximum-price contract may require a down payment of no more than half the cost of labor or half the price of materials, whichever is greater. Contractors must also register with the Office of Professional Regulation and put larger jobs in writing before taking any deposit. Separate criminal and consumer-protection laws address contractors who take money and fail to perform, and door-to-door sales carry a right to cancel.
Rules that bear on your deposit
Vermont law requires a person to register with the Office of Professional Regulation before contracting with a homeowner to perform residential construction worth more than $10,000. 1
A registered contractor must execute a written contract before receiving a deposit or starting work when the estimated value of labor and materials exceeds $10,000. 2
For an open-ended time-and-materials contract with no maximum price, the down payment is instead set by negotiation between the parties. 3
Sources
Vermont requires a person to register with the Office of Professional Regulation before contracting with a homeowner for residential construction worth more than $10,000.
A registered Vermont contractor must execute a written contract before receiving a deposit or starting work when the estimated value of labor and materials exceeds $10,000.
On a Vermont time-and-materials contract with no maximum price, the down payment is set as negotiated by the parties.
Frequently asked questions
- Does Vermont cap how much deposit a contractor can ask for?
- Yes, for registered residential contractors on fixed or maximum-price jobs. The down payment may not exceed one-half of the cost of labor or one-half of the price of materials, whichever is greater. On a time-and-materials contract with no maximum price, the down payment is whatever the parties negotiate, so no fixed ceiling applies.
- When does a Vermont contractor have to give me a written contract?
- A registered residential contractor must sign a written contract before taking a deposit or starting work whenever the estimated value of labor and materials exceeds $10,000. Registration with the Office of Professional Regulation is itself required before contracting for residential construction worth more than $10,000.
- What if a contractor takes my deposit and never does the work?
- Vermont's home improvement fraud statute makes it a criminal offense for a contractor to enter a home-improvement contract of $1,000 or more and knowingly fail to perform or refund. If the work was solicited at your home, you may also have a three-business-day right to cancel.
Last reviewed August 4, 2026
This page is general information about state law, not legal advice. Laws change, and how they apply depends on the facts of your situation.