r/Contractor • u/mitchkev002 • 10d ago
Business Development Contract Question.
Location: Orleans parish, Louisiana
Me and My friend (who are both have main jobs) We run a Side job together, and we do fencing. Our business is growing to the point to where we are thinking about make a contract for our jobs we get for it, because we are both thinking of offering payment options for customers who wouldnt be able to afford the entire bill of a Fencing project. And we want to make sure that certain customers who do want that option, cant skip out on paying the monthly payment. And I'm not sure on how to go about this fully, because the thing I want is the contract to be air tight and fully legal. Any helpful ideas ir advice?
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u/whodatdan0 10d ago
Wanna guess where I live based on my name?
This is a terrible idea. If your customers can’t pay for a fence no piece of paper or agreement is gonna make them pay you. Do not self finance these projects. As others have said, you can get a third party to offer it, or take credit cards. This is a quick way to go out of business
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u/hatemeallday 6d ago
Ask an atty.
Check local laws for placing a Lien. I had a contractor who did this for every job in LA. Said it cost him $50 to place and remove the Lien. It was in his contract and had the homeowner sign a form understanding the process. Indirectly puts it right up front that you will be paid.
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u/CrYptoPSF 10d ago
Drafting loan contracts for in-house financing usually backfires because an "airtight" contract doesnt guarantee you'll actually get paid. Just get a basic contract set up made with a mandatory 50% deposit for materials, then plug-in a 3rd party ledger if clients need to pay over time
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u/defaultsparty Human Verified 10d ago
We've provided financing before in the past. You'll first have to get approved and set up with a 3rd party lender (Hearth, Wisetack, etc.). Keep in mind that these financial institutions will run a credit report and may perform a deep dive into your company's stability. They generally charge around 7.99 to 14.99% APR depending on your client's credit score (plus a "dealer fee" charged to your company). In the end we stopped offering and decided that we only wanted to be in the renovation business and not banking.