On a $45,000 remodel, Pennsylvania law caps the deposit at $15,000 plus any special-order materials the contract names

Pennsylvania's Home Improvement Consumer Protection Act limits how much a contractor can take up front. On a contract with a total price over $5,000, the deposit may not be more than one-third of the price. When the written contract designates special-order materials, the cap rises by the cost of those materials. On a $45,000 kitchen remodel with no special orders, the most a contractor can collect as a deposit is $15,000. The rule is in section 9 of the act, codified at 73 P.S. § 517.9, and the Attorney General's Bureau of Consumer Protection enforces it.

Section 9(10)On a job over $5,000, the deposit may not exceed one-third of the price

The cap sits in the act's list of prohibited acts. Section 9(10) bars a contractor from receiving a deposit above one-third of the contract price on a job over $5,000, or above one-third of the price plus the cost of special-order materials that will be ordered, as designated in the written contract. Three other provisions work alongside it.

The act defines special-order material narrowly. It has to be something that is not a stock item, is ordered from the factory or distributor and made or processed for your contract, and cannot be returned by the contractor for a refund or credit. Custom cabinets built to your kitchen's measurements fit that definition. A faucet the supplier keeps on the shelf does not, even if the contractor buys it for your job.

The Attorney General's office describes the same limit in its answers on the act.

“Generally speaking a down payment of one-third of the total contract price or one-third plus the cost of special ordering materials is appropriate.”

Worked exampleOn a $45,000 kitchen, two special orders lift the cap from $15,000 to $28,500

This example uses round numbers and is not drawn from any real job. A homeowner signs a $45,000 fixed-price contract to remodel a kitchen. One-third of the price is $15,000, and that is the deposit cap if the contract designates no special-order materials.

Now suppose the contract designates custom cabinets at $9,000 as special-order materials. The cap becomes $15,000 plus $9,000, or $24,000. If the contract also designates quartz countertops cut to the kitchen's layout at $4,500, the cap is $28,500. The cost of the special orders is added to one-third of the full $45,000 price.

The contract lists the down payment and each special order on its own line

Section 7(a)(9) also shapes how the contract reads. It has to state the down payment and any amount advanced for special-order materials, and list them separately. In the $24,000 case, a compliant contract would show something like a $15,000 down payment on one line and $9,000 for the cabinets on another, with the cabinets named.

ScaleThe cap is one-third at every price, $2,000 on a $6,000 job and $30,000 on a $90,000 job

The one-third limit scales with the price. Below $5,000 the act sets no deposit cap, though section 9(9) still bars any payment before the contract is signed, and any job over $500 needs a written contract.

Section 9(10)(ii)A retailer that posts $100,000 in credit per store is exempt from the cap

Section 9(10)(ii) exempts a home improvement retailer from the cap if it posts an irrevocable letter of credit payable to the bureau, which is a bank's promise to pay set amounts on the bureau's demand. The amount is $100,000 per store, up to $2,000,000 for a retailer with several stores. The retailer must also make sure its installers are registered and carry the insurance the act requires.

If you buy an installed job through a store and the store asks for more than one-third, ask whether it has posted that letter of credit. Under the act, a homeowner in a dispute with such a retailer can file a complaint with the bureau and ask for a draw on it.

Section 8(a)(6)A false special-order claim over $2,000 is a felony of the third degree

The act treats a false special-order claim as a crime. Section 8(a)(6) makes it home improvement fraud to misrepresent an item as special-order material or to misrepresent its cost. When the amount involved is more than $2,000, the offense is a felony of the third degree. At $2,000 or less, it is a misdemeanor of the first degree. The grade goes one step higher when the victim is 60 or older.

PracticalWhat to check before you sign

Work out the cap yourself. Divide the contract price by three, then add only the items the contract names as special-order materials, each with its cost. If the deposit requested is higher, ask the contractor to bring it down or to show which items are special orders.

Test each special-order item against the definition. Ask whether it is made or cut for your house, and whether the contractor could return it for credit. A stock appliance, a standard toilet or a box of tile from the supplier's warehouse would not qualify. Ask for a copy of the order once it is placed, so you can see the item and its price on the supplier's paperwork.

Pay nothing before you sign. Check the contractor's registration number on the Attorney General's search or at 1-888-520-6680, the toll-free number every contract has to list. If the job never starts, section 9(2) requires a refund within ten days of a certified-mail request when more than 45 days have passed since the contract's start date and no substantial part of the work has been done.

The act does not say how the rest of the price should be paid. The Attorney General's office suggests negotiating payments as the work progresses, with a final payment at completion. Our guide to change orders and payment schedules lays out a schedule tied to inspections, and the guide to what Pennsylvania law requires when you hire a contractor lists every term a contract must contain. If the job is a roof, Conshy Roofers covers hiring a roofer.

LimitsCaveats

This is general information about the act, not legal advice for a particular contract. If a contractor has taken more than the cap or will not refund a deposit, ask a lawyer or the Attorney General's Bureau of Consumer Protection.

The act covers home improvements at a private residence, which it defines as a single-family house, a building of no more than two units, or a single condominium or co-op unit. A person who owns three or more homes in Pennsylvania counts as an owner only for a primary residence and homes used for personal recreation, so a landlord with several properties may fall outside the act on the rentals. New home construction and emergency work are outside it too.

The act does not say how the cap applies when a change order raises the price after the deposit is paid, or which figure counts as the price on a time-and-materials contract. Our article on time-and-materials contracts covers the second question. Ask the bureau or a lawyer before you agree to a deposit in either case.

The text described here is the act as posted by the General Assembly on October 13, 2026. Five bills that would amend it were listed on the General Assembly's page for the act that day, among them SB 1324, which would change the sections on home improvement contracts and fraud, among others. None had passed either chamber.