Retainage: the money held until the job is closed
What it is, who can hold it, and the paperwork that releases it on a subcontract.
Retainage is a slice of each payment that the owner or contractor holds back until the work is done. It is meant to keep everyone at the table until the punch list is closed. It also becomes, for many subcontractors, the last and largest unpaid number on the job.
Where the rule lives
The amount and the release date usually come from your subcontract, sometimes limited by state law, and sometimes tied to what the owner holds from the contractor. Read three things: the percentage, what triggers release, and whether a partial release is allowed when your part is finished.
Retainage is a promise with a date on it. If you cannot find the date, you do not yet have a promise.
What releases it
- Written notice that your work is complete
- Any inspection or sign-off the contract names
- A final lien waiver, signed only when the payment arrives
- Warranty or close-out documents, if the contract asks for them
When it stalls
Send the request in writing, cite the contract section, and keep sending it. Do not sign a waiver for money you have not received. If the answer is a back-charge you have never seen, ask for it in writing with the backup.
This guide is general information, not legal advice. Retainage rules differ by state, by project type and by contract.