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Your client ran out of money mid-job

If a draw is late and the client is stalling, stop starting new work, tell them in writing why, and protect what you're already owed. Working ahead of the money only makes the hole deeper, for both of you.

A contractor vented about a customer who ran out of money partway through a project and kept stalling, while the crew kept showing up. When contractors don't finish, everyone calls it abandonment. When customers don't pay, he said, it's somehow the contractor's problem.

What to do

  1. Ask directly. "Draw 3 was due on the 12th. Is the money there?" A straight answer now is worth more than a polite week of maybe.
  2. Pause in writing. Say what's overdue, that you'll stop after making the site safe, and that you'll be back within a set number of days of payment. Check what your contract says about suspending work first.
  3. Make the site safe and secure. Leaving a house open to the weather turns your payment problem into your liability problem.
  4. Offer a smaller job. Sometimes the honest fix is to finish one room properly and leave the rest for later, written as a change that reduces the scope and the price.
  5. Watch your deadlines. If you might need a mechanics lien, find out your state's deadline now.

Don't get blamed for the delay

The written pause is what protects you. Months later, the client may remember only that you stopped coming. A dated note that says draw 3 was unpaid and work was suspended until it was paid tells the real story.

Next time

Draws tied to finished stages keep you close to even, so a client who runs out of money costs you one stage at most. See how to set up progress payments. Write the right to pause for late payment into the contract, too.

A pause notice you can send

"Hi Laura, draw 3 for $8,400 was due on March 12, when rough-in passed inspection. We haven't received it. We'll make the site safe and weatherproof today and pause after that. We'll be back within three working days of payment, and the finish date moves by the days we're paused. If something's changed on your side, call me. We may be able to finish the kitchen now and leave the bath for later." Short, factual, and it leaves the door open.

Never far ahead of the money

In Everkept each draw falls due when its stage is signed off, and both of you see what's paid and what's late. If you pause, the record shows the unpaid draw and the date, so the delay is on the right side of the ledger.

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This is general information, not legal advice. States differ on what a home improvement contract and its changes must contain. Check with your state’s contractor licensing board or an attorney.