How do I review a contractor's monthly pay application?
Paying ahead of the work is the fastest way to lose leverage on a project. Almost every troubled job started with a generous early draw.
Verify billed percent complete against observed work in the field, confirm stored materials are on site and insured, hold the contract retainage, and require conditional and unconditional lien waivers from every subcontractor paid in the prior cycle before releasing funds.
The checklist
- Walk the site before approving — compare the schedule of values line by line
- Stored materials: photographed, on site or in a bonded warehouse, and insured to your benefit
- Retainage withheld at the contract rate, with no early release without your written consent
- Lien waivers: conditional for the current draw, unconditional for the prior one
- Updated schedule attached, as required by contract
Why over-billing happens
Contractors finance the work between draws, so front-loading the schedule of values is a cash-flow strategy, not necessarily bad faith. It only becomes your problem if the contractor leaves the job — then the remaining money will not buy the remaining work. Catching a front-loaded schedule of values at contract signing is far easier than unwinding it at 60% complete.
Common questions
- What retainage is normal in South Carolina?
- Retainage of around 5% is common on private work, and public work is governed by statute. What matters more is when it is released and against what conditions — punch list completion, closeout documents, and final lien waivers should all be prerequisites.
Start with a conversation.
Tell us where the project stands. We'll respond within one business day — with next steps, or a candid reason it isn't the right fit.
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