# Start before the check clears?



## RyanofWar (Jan 18, 2011)

I have a customer who we've done a few jobs for. This time, he handed us a check and is persistent on a deadline. Monday morning came around and the check didn't clear. I called the customer about the check to explain why I couldn't begin on this Monday. The customer got a bit insulted and I had to explain that I can't lay out the money and this is a big benefit of paying a deposit in cash, especially on a deadline.

Question is?: Should I be willing to lay out materials for a historied customer? 
I'm confident in my business practices, and feel that waiting for the check to clear would prevent any potential problems. 

What do some of you guys/gals do?


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## tcleve4911 (Mar 26, 2006)

You don't buy your materials on credit?
I'd get a little upset too. Cash is NOT a typical transaction.

The checks good....the bank takes time to process...you buy stuff with 30 days to pay....

What's the problem?


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## pinwheel (Dec 7, 2009)

In this day & age of electronic banking, there is no real waiting period to see if the check clears.Deposit it & check your bank account 24 hours later. If it bounces, run.


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## Calisota (Apr 15, 2011)

Awkward for all parties, especially for an existing relationship. No one wants to be confronted with a bounced check that wasn't intended to do so.

Assuming no ill intentions on their part, I would proceed with normal business practices.

"Dear ___________, I'm sure there was a simple banking error. We are ready and prepared to begin work on the date we discussed once deposit funds are cleared. Just let us know if you'd like us to re-submit the existing check or wait for the issue of a new one. I greatly appreciate the trust you've shown in (business name) over the years and we are ready when you are to improve your home.

Sincerely,
__________"

I don't entertain arguments over standard business practices. Questions are welcome, but I stand firm behind all payment schedules.


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## jmacd (Jul 14, 2009)

Did the check bounce are just not clear yet?


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## Dan_Watson (Mar 1, 2008)

Especially for a repeat customer I would not wait for it to clear. I am always a little leery if it is a big deposit and I am starting within three days of signing because of the rescind period. 

Are you strapped for funds or just scared to put money out of pocket?

Cash (debit card/checking account) is how the vast majority of my materials are purchased. My info is on file at most of the suppliers I use, I order, they POS withdraw.


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## Rio (Oct 13, 2009)

It depends on the customer. If I have a good relationship with them and trust them no problem; if I don't, no way.


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## greg24k (May 19, 2007)

If according to the payment schedule stated in your contract, you must get A to do B, and you don't have the A, then you don't do the B. Especially I sense a little worry on your part, so there must be a reason for it... So do what you have to do :thumbsup:


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## accentstonework (Apr 17, 2011)

I think that good business practice would be to wait for the terms of the payment schedule to be met. On the other hand, if I had a repeat customer that I'd had no problems with before, I might just go ahead and start. But I don't think waiting for the check to clear would be unreasonable either. Go with your gut on this one.


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## svronthmve (Aug 3, 2008)

Calisota said:


> Awkward for all parties, especially for an existing relationship. No one wants to be confronted with a bounced check that wasn't intended to do so.
> 
> Assuming no ill intentions on their part, I would proceed with normal business practices.
> 
> ...


My policy too.

I don't front money for customers' projects unless I'm willing to lose it. The only time I've ever lost money is when I went ahead with established customers and didn't set up a contract or get a deposit before starting the job. Lesson learned the hard way, but learned oh so well! 

In my experience, decent / respectable customers understand that. Those that don't, probably will be a problem. 

I would be calling the customer and get a "feel" for what might have happened. We ALL occassionally make banking mistakes. If they straighten it out and you re-deposit without problem, I wouldn't be too concerned.


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## RyanofWar (Jan 18, 2011)

Talked with the customer today, and he seems to understand. Usually checks clear within a day or two but not this one...Oh well, I'll do what I can with time I have once the check goes green. I layed out a minimal amount today just in good faith to at least get something started so as not to look arrogant. I feel that the bottom line is-I wouldn't expect nor want another to lay out for me, so...Business is Business


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## Framer53 (Feb 23, 2008)

You need a new bank.

My bank honors local checks deposited next day. Out of state 3 days.


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## Chris Johnson (Apr 19, 2007)

If your so concerned...why didn't you go a certify it?


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## RhodesHardwood (Jun 28, 2010)

I would wait until it clears.


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## tedanderson (May 19, 2010)

In a normal situation (yeah.. like what's really normal) where there is advanced scheduling, pre-planning, etc. then the HO should be giving you a deposit at least a week or two before the agreed start day. 

But if the HO needs you to start right away and he has tight time restraints, then getting you a wad of cash is the price that he has to pay for last minute planning. When someone comes to me on Friday in need of a home theater setup by Monday, then I demand all of the money upfront.


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## Electric_Light (Nov 25, 2007)

Who pays green paper cash for contractor service unless you're hiring Craigslist hack? It's a stupid way of paying it. If you default on your subs, then you tell me I didn't pay and I couldn't produce records, its your word against mine situation.

It's really sketchy, just like buying an international airfare or a vehicle with actual cash. When someone say they paid for their car cash, they mean they paid for it in lump sum without a loan, but not using paper cash unless they're talking about some $500 beater.

If you're worried, note it for the future that you do not accept deposit in personal check and insist on money order(up to $1,000) or cashiers check (in excess of $1,000).

I don't remember the last time I've handled more than $200 in actual cash at a time. I'm not sure who handles more than $1,000 in a cash on a regular basis other than drug dealers.


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## Rob PA (Aug 30, 2010)

The only time i have been stiffed was on existing customers without deposits or before it clears.

If your gut says wait. Wait. I have started really pushing to keep a straight policy on a few matters like this. It has already saved me money i would of lost on jobs i didnt get.


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## tcleve4911 (Mar 26, 2006)

All the guys make great points:thumbsup:

I started work for a repeat customer on a change order that involved removing T&G wainscot and chair rail in a dining room.
I didn't get the check the day they promised but I went ahead and ripped apart the old, painted T&G and threw it into the dumpster.

That night I talked to the customer.

"We didn't send the check because we changed our mind. 
We've decided to keep the Dining room the way it was" :blink:

Policy....stick to it.......


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## Pearce Services (Nov 21, 2005)

I have a 3 day right of recision as required by Mass law in my contract. I can not start the project until the right of recision expires, this is usually long enough for a check to clear. It may be required in your state, but even if it is not, you might want it in your contract.


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## Framer53 (Feb 23, 2008)

It is required in NY. Exception is if they sign a waver.

Cash must be set in a special escrow account in the bank until used or a bond must be posted.

NYS might not require contractors to be licensed but in the contract part they are on the ball. That AND PROSECUTING CONTRACTORS WHO TAKE DEPOSITS WITH OUT DOING WORK.


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