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I'm curious what "leverage" you utilize when you are working for someone, either a general contractor, builder, or homeowner, do ensure you collect payment from them for the work you perform?? Yes there is the simple Lien but sometimes this isn't enough or isn't strong enough. What kinds of things do you do to cover your arse? What "Tools" do you have at your disposal that you feel are worthwhile to share? I'd like to hear all of them, from the legal, fair, type things of course, but I've also heard a few ahem, "interesting" things done to ensure leverage for payment for work done.
 

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Start with covering your arse before you begin. Make sure you get a signed proposal/contract. When you're finished and they have to be billed just make sure you find someone and get a signed invoice stating the work is done and they approve.
Both should have when payment is due and by what method. If they don't pay then what the heck, legal action.
 

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When I was still plumbing houses, I had a written contract and specified payments and I still couldn't get paid. The guy knew that I wouldn't do anything about it because I thought I'd get more houses down the line.

Of course, I got paid in about 2 months. Meanwhile, it was, "Don't worry - you'll get your money." But it was still breach of contract.

Since that sort of thing was happening on every job I was doing, I decided to go strictly service work.
 

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a local plumber i know who has been burnt in the past bad and has reason to be skeptical does the following when roughing in a house.

He crosses the hot and cold in a somewhat hidden spot, that is accesible in the future, with a ball valve.

If the customer pays, he keeps the ball valve off, if he doesn't get paid he opens it up.

Then tells the customer to have fun trying to find out why they are getting hot water all over the house...

i thought that was pretty funny
 

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Thes best way to collect your money is....

a personal face-to-face visit with your customer or general contractor.

Some people and contractors will never pay and there are many things you can do, but even with the best attorneys you will seldom get your money from a person who does not want to pay. You can go to court 10 times, win, and the debtor can file bankruptcy or hide their assets. So, my philosophy is; a customer is the type that pays, or he is not. I think threatening a customer and filing a lawsuit makes makes a customer more determined to fight you, or more hard-boiled.

I have been in business 36 years and sued only one customer. This month I filed in small claims on three customers and I am betting I will not collect any money after going to court up to 5 times for each customer. First we win the case and the customer gets an appeal. After the appeal we still have to take them to court a 3rd time to get a list of their assets. Then, the judge decides how the person will pay and this is usually very small monthly payments. When the customer does not make the payments we get to go to court a few more times.

In 36 years, I had only two customers give me bad checks and both checks were for exactly $800 and both customers had idential last names from an Asian country, even though they did not know each other. In the past 8 months, I got three bad checks and the amounts are very strange. The amounts are $1200, $2400, and $3600, but were not received in that order.

We are definitely having more than average problems collecting money. This is a reason to work harder to offset the losses we are taking.
 

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Payment on Plumbing

We run into this from time to time.
We would offer payments or pay later plans and ran into no payment at all.

First call and play nice guy. Things do come up and no matter what you say the customer will pay there house payment before they pay you. That being said if you dont get paid after 2-weeks play nice on the phone and request a payment.

At the end of 30-days do a follow up call. Tell the customer that unfortunately there is a minimum late fee of $15 dollars (or whatever) for every past due month. But you can waive this if they pay by phone TODAY. If they cant ask, when can you pay. Get a DATE. Tell them you will hold on the late fee until that time. Call them back at that time.

After 60-days tell them its now a $30 fee and you by law only have so long to collect your money. If a payment is not received you will have to turn it over to magistrate. Send them a certified letter if you want (this moves people). Come 90-days put it on with the magistrate. Dont feel bad, you have to eat too.

All that being said. We no longer take payments unless the customer has a credit card or check on file. We fill out the info and they sign it giving us authorization. If we run it and it bounces they are screwed. Dont leave the door without payment or a signed payment agreement. I have bad accounts still open till this day, but not one has happened since i started making my guys fill out payment forms. NO WORK unless the person responsible for payment is ON SITE or has give you a card/check over the phone on file.
 

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Will you be paying in cash, check or credit card today? ;)

We are strictly a service company now. Fortunately we no longer have billing issues. Occasionally we will get a bad check. Maybe 5 or 6 a year. Luckily, the county we work in will chase down the deadbeats for us. If they don't make good on the check within 30 days, its time for a bench warrant. Bad check writers have to make restitution, pay a hefty fine and go to check writing class that they have to pay for. It's kinda like when you have to go to driving school when you get a speeding ticket. :)
 

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We don't even go out until payment arrangements have been made with the dispatcher. Either credit card of C.O.D. No checks for amounts larger than $ 100.00 Oh, and we only do work for a very few, very trusted contractors.
 
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