It says "when the permit is completed", those words? I have never heard of a permit being "completed". It could mean when the the final occupancy permit is issued, or it could mean when the work being done under the building permit is completed. However, there can be a lot left after the occupancy permit is issued. I probably had at least $50k to do on my house when I got my occupancy permit. The building inspector is not going to inspect to see if the house is completed per the contract, the inspector just issues an ocupancy permit. The level of completeness for the OP varies state to state, town to town, but an occupancy permit is to make sure the house is safe, not to make sure the drywall looks good and the tile was grouted the right color. I've seen practical shacks that were issued occupancy permits.

Can you provide the exact language from the contract?

Yes, the final invoice should've included a copy of the final inspection pass. Ask the contractor to send you a copy (or tell you where to go to get a copy) so you can write the final check. Don't send the final money until you know everything has passed inspection.

Sue, "balance due when permit has been completed" are the exact words used in the contract. It doesn't exactly make sense but I took it to mean when the final inspection is passed. The project was a deck, not a home renovation.

In MA a contractor is expected to give notice to the building official that the project is completed and ready for the required final inspection. If the final inspection reveals no deficiencies, a Certificate of Occupancy is issued for the property.

The use of the phrase "completion of the permit" is unclear but I think it is reasonable to delay final payment until the contractor shows you either a copy of the permit card with the final inspection part signed or a C of O.