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Unread 01-20-2014, 07:04 PM   #16
Houston Remodeler
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The last builder I worked for was up to his waist in financial problems. The real estate market was crashing and he was in denial.

I threatened to hire his customer, the home owner, as my lawyer to get my payment.

I was the only sub to be paid in full.

Don't work for builders anymore either. Now I work for, and get paid by the HO directly. Besides they get a better warranty from me than the boilerplate TX builders warranty.
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Unread 01-20-2014, 07:10 PM   #17
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That's the way to do it.....!
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Unread 01-20-2014, 09:26 PM   #18
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I've never done deposits (but thinking about it). Seems like every year I get a couple of last minute cancellations.

With H.O.'s I expect payment on delivery for tiles and payment on completion for the rest. If the job is big then I submit a bill for completed portions every two weeks. With G.C.'s I expect payment within 30 days of completion, but all the one's I work with now pay faster than that.

Of course, I'm in a whole different country than most of you guys. Up here for commercial work the norm seems to be 30 days from completion and a 10% hold back for 90 days. I haven't played in commercial enough to know the whole range of normal though.
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Unread 01-20-2014, 09:27 PM   #19
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Jess,
the law is called: Arizona Prompt Payment Act.... here's the link.... http://www.lang-baker.com/publications/prompt-pay.htm.... look at the section, "Subcontractor’s right to stop work" down at the bottom.

Brad,
I've been doing a few small jobs a year with this GC for the last 20 years. Nothing big. I'm thinking about terminating our relationship. Don't need the work nor the headaches.
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Unread 01-23-2014, 05:58 AM   #20
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Joe, sounds like he has you wrapped around his finger. You let him dictate how things are. Just my thoughts.

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Unread 01-23-2014, 03:19 PM   #21
A.J. Holst
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On residential, we get 50% down, balance upon completion.

On commercial work, when we paid depends on the GCs bill date; and retainage can take months.

Here's an example, GC bill date is the 25th, we get the material and start the job on the 26th. I can't bill until the 25th of the following month and then add 10 - 15 days check processing and the mail.

We don't do business with GCs who play the "I'll pay when I get paid game." If we do have a new client who tries, I simply call the owner and/or architect, ask if the GC has been paid, advise I haven't and will proceed with a lien, that usually gets the cash flowing
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Unread 01-26-2014, 01:28 AM   #22
Todd Stull
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1/3 down is the new (er) law here and special order materials can be collected on top of that, if needed. Progress payments can be broken down in any format.
I recently became a bitcoin merchant so it's pretty exciting to be a part of that.
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Unread 01-26-2014, 02:37 AM   #23
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Quote:
Originally Posted by A.J.
Here's an example, GC bill date is the 25th, we get the material and start the job on the 26th. I can't bill until the 25th of the following month and then add 10 - 15 days check processing and the mail.
In a case like that I would get the material and start the job on the 24th.
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Unread 01-26-2014, 01:04 PM   #24
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Quote:
Originally Posted by joethepro
Got a contractor telling me he'll pay me when he gets paid and he says he pays ever 90 days. Seems like 90 days is too long. Also, what do you think about "pay if paid" clauses?
This brings why it's good to have systems. This gc has a system- 90 days and only then if he gets paid. What's your system? If you don't have a system you are going to default to his. His is a pretty good system for him.

I'm a big believer in win-win contracting deals. I know how I want the project to go and the gc knows what they want out of it. If both sides are negotiating in good faith it's usually pretty easy to come to a win-win agreement.

These days I only have one contractor that has 30 days to get paid terms and he's my best contractor. The other guys I've dumped because 30 days turned into 45 then the check was supposedly in the mail, etc. Who needs that?

Let your competition work for the 90 day guy. That way you will be free to take on a better contractor's work.
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Unread 01-26-2014, 06:30 PM   #25
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If you have plenty of other work as you say, Joe, I'd send this yayhoo packing. Even if he'd been a gc you'd had a long time working relationship with, the "you get paid when I do" provision would be enough for me end things.

FWIW, jobs over $1k, I typically ask for 1/3 when I start with the balance due on completion. I don't work for builders though, so it makes it a lot easier to dictate your terms.
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Unread 01-31-2014, 11:13 AM   #26
A.J. Holst
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Isaac,

You hit it on the head, start work before the bill date!

We also bill for stored materials in the event the GC expects me keep my schedule even if he can't keep his. Adds a step or two, but keeps the cash flow in good shape.
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