Using your lawyer to collect draws and ensure payment for change orders

Last week, a contractor wrote about how verbal agreements had led him into trouble collecting. We soon had a post from veteran homebuilder “Le” (Lee?) on how this particular contractor might want to take a page out of his/her firm’s operating manual.

Here is a way to make sure you get paid for your services listed in your building contract.
1) Have your lawyer’s name in your contract.
2) All project draws as per your contract are paid by your client via your lawyer.
3) All requests for extras by your client must be submitted to you in writing. Submit your quote to your client with a copy to your lawyer. Client has 5 days to respond. If client approves the extras, they must submit the funds for the extras to your lawyer. DO NOT start any extra work until your lawyer advises you they have received payment for the requested extra(s).

We have built over 1,000 single family homes in the past 31 years using this policy, and it works.

If your propestive clients do not like your payment policies, then you know up front that they are not worthy of your services.