Would you prefer a life vest to help prevent you from drowning or a lifebuoy after you're already in rough waters? Let's hope no one is drowning (or drowning in work), but it is important to consider your strategy for preventing tough situations. These 3 tips will help your company take a proactive approach to getting paid quickly so you can stay afloat.
1. Communicate with your customers upfront
When is communication a bad thing? (That's a rhetorical question... but the answer is almost never.) It's good to keep others informed and communication in the construction industry is no different. Before you start your next job, let your customer know that you — as standard business practice — send notices.
This shows your customer that you have your ducks in a row and follow standard best business practices. Letting them know ahead of time also illustrates that you’re respectful and communicative. Taking a moment to speak with your customers means no surprises when they get a notice in the mail and it allows your customer to give a heads up to the property owner or GC that they may receive a notice as well.
For help on how to communicate with your customers (and internal teams), check out zlien's Guide to Rolling Out a Notice Policy.
2. Track deadlines for all Projects
With a zlien account, this one is quick and easy! Add all of your projects to zlien and include the furnishing dates. (Here's a 2-minute tutorial if you need help.) If the project is still in progress, add your estimated completion dates. This will help ensure that you don't miss any deadlines, and it’s very easy to update these dates if they change. Even if you decide not to send a document, making an active decision not to send a document is better than finding out down the road that you’re too late!
Want to save time adding projects to zlien? We can import all of your projects, invoices, and and furnishing dates for you. Learn more about spreadsheet imports here.
3. send non-required notices & notices of Intent
Tracking deadlines will keep you informed of any required documents that you need to send to protect your lien rights. However, you should also consider sending non-required documents. Sending non-required document can help you get paid faster and prevent you from having to file a lien. zlien’s data shows that a mechanics lien only needs to be filed in fewer than 2% of cases where preliminary notice and notice of intent are sent properly. Let’s dig into these two documents more.
If your state doesn’t require you to send preliminary notices (also called a Notice to Owner or Prelim), there are so many reasons to consider still sending them. Sending a notice prioritizes your payment and motivates the part with the money to pay you before others. It promotes communications by letting the general contractor and property owner know that you are working on the job. Believe it or not, the GC wants to know everyone who is working on their project so they can get signed lien waivers. Learn more about the the people who will thank you for sending preliminary notices here.
Notice of Intent to Lien:
A notice of intent to lien is a document that’s required in only 9 states. However, notice of intents are very powerful tool to help get you paid. It’s essentially a threat letter that tells others on the jobs that you intend to file a lien if you do not receive payment in a set number of days. Let’s image you’re a sub-subcontractor and your customer hasn’t paid you because they haven’t been paid either. If you send a notice of intent to lien to the property and general contractor, they are going to do everything they can to get you paid so they don’t get a lien on the property. In fact, they will likely be very glad that you sent them a heads up so they could help get the issue addressed and avoid a surprise “ghost” lien.
There you have it, folks. On your next project, have a quick conversation with your customer to let them know that you send notices, make sure you are tracking all of your project deadlines in zlien so you can make informed decisions, and consider sending preliminary notices and notice of intents even when they aren't required by your state.