Milestone Draws ($1,000 Deposit Cap)
Also: progress payments · draw schedule
California law caps a contractor's down payment at $1,000 or 10% of the contract, whichever is less — so on an ADU it is $1,000. The remaining cost is paid in milestone draws released only after each phase (design, permit, foundation, framing, MEP, drywall, completion) passes inspection.
Inspection-tied milestone draws protect homeowners from the up-front-deposit losses that sank builders like Anchored Tiny Homes. Upside's payment structure follows this legal cap exactly. For a Sacramento homeowner this is the rule that keeps money tied to work actually completed: instead of a large deposit, the contractor takes the $1,000 maximum and then collects each draw only after that phase clears a city inspection — foundation, framing, MEP, drywall, and final. Because Sacramento permits are ministerial, those inspections happen against published code standards, so each release point is an objective checkpoint rather than a judgment call, and a homeowner is never paying far ahead of the build's real progress.
Go deeper:The Upside Guarantee
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