How should you structure a payment plan for a returning client?
Short answer. Use a milestone-based payment schedule, and document existing conditions with photos, what is being demolished and why, the new scope, and the permit and inspection schedule in the contract.
Work it through
You're the contractor. Pick what you'd do, then see how each choice plays out.
Carl Brennan
Retired engineer who started a renovation himself, made it worse, and is now calling you to fix it
Three weeks later, Carl calls back. He got two other estimates: $39,000 and $45,000. He also got one for $12,000 from a guy who said he'd 'make it work.'
"I guess you were right. The cheap guy didn't even have a license when I checked. Can we talk about a payment plan?"
- Perfect outcome
Carl educated himself, verified your pricing was fair, caught an unlicensed contractor, and came back to you. A milestone-based payment plan is reasonable for a $42K project. The contract should clearly document: (1) existing conditions (photos), (2) what's being demolished and why (code citations), (3) new work scope, (4) permit and inspection schedule. Carl is now your best referral — he'll tell everyone 'get three estimates and check licenses.'
All 13 running a compliant business questions
- What records should a Maryland contractor keep?
- How many projects can you take on before quality suffers?
- How do you estimate honestly for a flipper on a tight budget?
- Should you match a lowball bid to win a job?
- Who is liable when a client tells your crew to cut corners?
- How do you handle a client's sticker shock?
- How should you structure a payment plan for a returning client?
- Are weekly progress reports worth the effort?
- What grants help disabled veterans pay for home modifications?
- How does contractor burnout lead to MHIC complaints?
- What is the most important thing to know for the MHIC exam?
- What one habit keeps contractors out of trouble with the MHIC?
- What advice would you give a newly licensed Maryland contractor?