When are retentions normally paid to contractors?

Retentions are typically paid to contractors upon completion of a project and after the expiration of the lien period. This practice serves several important purposes in the construction industry. First, it provides an incentive for contractors to complete the work to the satisfaction of the client, ensuring that all aspects of the project are done correctly before the final payment is released. Second, waiting until the expiration of the lien period protects the homeowner from potential claims by subcontractors or suppliers. If any issues arise after project completion, the retention amount can be used to address those concerns, ensuring that the contractor is motivated to resolve any outstanding problems.

This timing for payment aligns with best practices in construction management, fostering a better relationship between contractors and clients while also safeguarding the interests of all parties involved.