In California,  a licensed general contractor cannot take more than $1,000 as a deposit to start your project.  This is law mandated by the California License State Board.  You hear  of  so many horror stories of contractors running off with large sums of money leaving the poor homeowner with nothing but missing money all the time.

Do not fall for the number one excuse that many general contractors offer up - they need a deposit to order or hold the materials.  This is ridiculous for many reasons:

1. if your general contractor cannot “float” $1,000 worth of materials to get your project started then they don’t have the financial backing to execute your project - it’s better to know this up front than pay the price later when things go awry and the general contractor is at fault to cover the added cost
2. if your general contractor truly insists that this is to order materials on behalf of your project - than ask them to draft an order and pay for the materials yourself
3. it’s common practice to “borrow” funds or intermingle funds from one project to another for general contractors who are not keeping their nose clean

Another way to protect your interests in seeing the project through is to insist on a 10% retainer.  This retainer will be paid as a balloon payment at the end of your project and keeps your general contractor on the hook to complete your project.   Again, if your general contractor cannot accommodate a retainer then you should question their financial resources to undertake your project.