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76 Posts
How many of us have been stiffed by a homeowner who refuses to pay?
I just got stiffed by a homeowner who apparently loves my work but keeps putting off paying. She is either "out of town" or never available.
My wife called her under a restricted number finally and surprise, the client answers the phone. But then hung up saying "hold on, I'll get [the client]" acting like she was someone else.
Then I started wondering why our industry doesn't use an escrow service for contracted work. It isn't illegal as far as I can tell. I've called several escrow services around and they say they can do it for about 2% of the contracted amount. Small price to pay to be assured the money is there at job completion. And the hardest part of parting a homeowner with his or her money has already been done at the start of a job. All they have to do is okay the work to release funds. Sure it isn't a cure all for the whiney customer who always has a reason to hold funds but it would eliminate the ones who don't have the funds to pay but hire us anyway or just don't want to pay.
There is no incentive right now for shady homeowners to pay. They gamble with whether we have the time or inclination to go to battle for our money and in the end if they lose, they only pay what they owe anyway. And if we give up, they get off scott free.
Mechanic's liens, small claims courts; they are all so lengthy not to mention expensive when you take into account time lost on the job.
We contractors are left out to dry. All the protection by the law is for the consumer. But what about the small independent contractors who really are working hard and doing a good job?
If it became industry standard to put fees into escrow, wouldn't it make life easier not only for us contractors but for homeowners as well? Homeowners would still have the final say in whether the work is acceptable and contractors would be able to go into a job knowing the money is there.
Can anyone here give any other suggestions? And if this sounds like a good idea, pass it on.
I just got stiffed by a homeowner who apparently loves my work but keeps putting off paying. She is either "out of town" or never available.
My wife called her under a restricted number finally and surprise, the client answers the phone. But then hung up saying "hold on, I'll get [the client]" acting like she was someone else.
Then I started wondering why our industry doesn't use an escrow service for contracted work. It isn't illegal as far as I can tell. I've called several escrow services around and they say they can do it for about 2% of the contracted amount. Small price to pay to be assured the money is there at job completion. And the hardest part of parting a homeowner with his or her money has already been done at the start of a job. All they have to do is okay the work to release funds. Sure it isn't a cure all for the whiney customer who always has a reason to hold funds but it would eliminate the ones who don't have the funds to pay but hire us anyway or just don't want to pay.
There is no incentive right now for shady homeowners to pay. They gamble with whether we have the time or inclination to go to battle for our money and in the end if they lose, they only pay what they owe anyway. And if we give up, they get off scott free.
Mechanic's liens, small claims courts; they are all so lengthy not to mention expensive when you take into account time lost on the job.
We contractors are left out to dry. All the protection by the law is for the consumer. But what about the small independent contractors who really are working hard and doing a good job?
If it became industry standard to put fees into escrow, wouldn't it make life easier not only for us contractors but for homeowners as well? Homeowners would still have the final say in whether the work is acceptable and contractors would be able to go into a job knowing the money is there.
Can anyone here give any other suggestions? And if this sounds like a good idea, pass it on.