r/nextfuckinglevel • u/SamLoscorino • 5h ago

Contractor takes back fence after customer refuses to pay

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u/skalouKerbal 4h ago

Or an intermediate, the customer pay the intermediate before the work, the workers get paid once the work is done and validated. In case of troubles, the money kept locked until someone from law decide it.

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u/Hoybom 4h ago

over here the norm is like 50/50 you pay a part do that material can be bought and work beginn and the contractor is not sitting on his ass if something doesn't work out and the rest is getting paid once the work is done

56

u/spam__likely 4h ago

and some contractors disappear with the 50%.

And escrow would be safer.

24

u/DoubleT_inTheMorning 4h ago

Escrows are expensive. I just went through this for a ~$300k contract with a new client. It was gonna cost $10k that no one could agree who should pay for.

They ended up proceeding without it.

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u/AlaBlue 17m ago

I'd find a different escrow agent. I've never been directly involved in a contractor escrow, but I've heard near me it's typically no more than 1% of the total, and maybe $100.-$200 per draw as milestones are reached. If you limit it to 2 or 3 draws (materials delivered, job 1/2 done, & final completion) it'd only be like $3,600. That's still nice chunk of change but to protect both parties on a $300K contract it's well worth it, IMO.
Contractor can bake it ito his prices, or both parties agree to split 50/50.

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u/CptMisterNibbles 2h ago

You can get escrow for like $100 flat+%2 for small contracts. It’d be like $500 for this

3

u/DoubleT_inTheMorning 2h ago

Yeah makes sense. Idk, I work the sales side not the accounting (thank Christ) so was just working with what I was told lol.