Paying material cost upfront to contractors

[Dhaval Sheth]

Hi fellow investors, I am in the knowledge-gathering zone and when it comes to the topic of how to pay to the contractors, I have read people saying that they only pay for the material cost upfront. But when exactly is that? Is it before the contractor purchases the material or is it when the material reaches the project site? And generally, will the contractor be okay with the arrangement of buying the material out of their own pocket if you say you will only pay when I see the material and the receipts?

Thank you. 

[Sarah Brown]

What is standard for your area?  It is not uncommon here to have a contractor require a deposit on a larger project.  They may not label it as "material expense", but ultimately that is what it is paying for.  It is also your skin in the game to ensure the contractor isn't taking all the risk.  I have seen some as high as 50% and some as low as 10%.  I have also seen where the client provides all the materials.