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Exactly. This is the same reason car dealerships or mortgage lenders ask for a down payment. You want both parties to have "skin in the game" so neither wants to walk away from the deal. If you can't come up with $500 upfront as a show of good faith, I don't want you as a client. That is non-negotiable. In my experience, this is more of a problem the lower the project price is. On $5000+ projects, you're dealing with a type of client who is used to paying deposits upfront (just like when you buy a car, a house, or hire a contractor to remodel your bathroom). On the $500-$1500 projects you get more amateurs.

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