Retainage

Retainage is a portion of a contractor’s payment that is withheld by the project owner until the work is completed satisfactorily. Typically around 5-10% of each payment, it serves as a financial safeguard to ensure the contractor finishes the project properly and addresses any issues or repairs needed after completion. Once the work is approved and all conditions are met, the retainage amount is released to the contractor. This practice helps protect the project owner from potential delays, substandard work, or contractual issues.