West Virginia Contractors License Test 2025 – 400 Free Practice Questions to Pass the Exam

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What does the term 'retainage' mean in construction contracts?

A bonus paid for early completion

A portion of payment withheld until project completion

Retainage refers to a specific practice in construction contracts where a certain percentage of the total payment due to a contractor or subcontractor is withheld until the project is completed satisfactorily. This withholding of funds serves as a form of security for the project owner, ensuring that the contractor or subcontractor addresses any outstanding issues or defects before final payment is made. By retaining a portion of the payment, the owner can motivate the contractor to complete the project to the required standards and resolve any problems that may arise during completion. This practice is common in the construction industry to help ensure quality and completion for large projects.

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A fee for project management

A charge for permits necessary

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