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Discussion Starter · #1 ·
Do you use them? Bidding on large remodel and owner wants to pay by joint check. I'm not familiar with them and want to get up to speed. From the gc's standpoint do they help, hinder or do neither? Thanks.
 

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The helpful part is that it assures the customer that the subs are getting paid and won't lien the property. Back it up with lien releases.

The potential drawback is that customers will try to use it to gain insight into your cost structure and beat down your price: "Why am I paying you $5000 for $3000 of plumbing work?" You need to have an answer for that question: markup, or support and supervision, or total price fixed bidding, or whatever.
 

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Discussion Starter · #6 ·
I'm leaning towards not doing it for above said reasons, high maintenance and exposes price info that does not need to be shared.

Although i need some clarity...Say I owe the sub $2000 and I have the customer write the check for $5000, according to a payment schedule, how will the customer know the breakout? We both endorse it and i deposit in my account and pay the sub his portion. Or does the joint check need to be written for only the amount owed the sub or supplier?
 

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Tall Moose
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I wouldn't do it. It's non of my customers business what I pay my subs, and at the same time - it's none of my subs business what I get paid. Nor would I wan't to co-mingle multiple unrelated businesses' finances.

Lien waivers and an explanation should satisfy the customer, if not, they may not be worth working for. Could be a sign of things to come.
 

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GC/carpenter
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You might want to check the laws of your state, our customers have the right to do that. It protects them from liens. Of course it's the customers business. It's in the mandatory lien rights notice we have to give them with each contract. They don't have to know how much you pay your subs, but if the sub sent out a preliminary lien notice it says on the notice how much it is and they have a right to make a joint check out for said amount.

If you refuse, they have a right to wait for all lien releases and a minimum of 20 days to allow all subs the time allowed by law to submit to the HO a prelim notice. Then they have a right to demand you pay the subs before they pay you. Along with your payment to the sub in full will have to be accompanied by the appropriate lien notices. Then when all prelims have been honored with releases then they have to pay you.

This could all be avoided with a joint check.
 
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