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Is a special holdback account always necessary?

April 26, 2017account holdback necessary special

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Is a special holdback account always necessary?

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A. Yes, with two exceptions. The first is where the value of work and material supplied is less than $100,000 (e.g. renovations). The second is where you have authorized the construction lender to disburse the mortgage money on your behalf, in which case the lender holds back 10% from each draw. However, this results in a new area of liability for lenders that most will not be willing to enter.