Guide · Getting paid
Invoice payment terms for contractors
The terms you print are the date most customers pay. Pick a short one and make paying easy.
For homeowners, use due on receipt or net 7 (due within 7 days). Net 30 tells a customer they have a month, and most will use it. Save longer terms for commercial clients who require them. Whatever you pick, print an actual due date on the invoice, put the terms in the estimate the customer approved, and include a link they can pay from by card or bank. Terms set when payment is due; an easy way to pay is what makes it arrive.
The common terms
| Terms | Means | Good for |
|---|---|---|
| Due on receipt | Pay when you get the invoice | Repairs and small jobs finished in a day; the customer is standing there |
| Net 7 | Due 7 days after the invoice date | Most residential work; enough time to pay without forgetting |
| Net 15 | Due 15 days after the invoice date | Property managers and small landlords |
| Net 30 | Due 30 days after the invoice date | Commercial clients and general contractors who require it |
| Progress billing | Invoices at set stages of a longer job | Multi-week jobs; some states require payments to track the work done |
How to word them
Write the date, not just the term. "Due on receipt" and "Net 7" are jargon to a lot of homeowners; "Due by March 14" isn't. A clear line looks like this:
Due by March 14. Pay by card or bank transfer at the link above, or by check to Ridgeline Plumbing.
Put the same terms on the estimate. A customer who approved "balance due on completion" before you started doesn't get to be surprised by it after.
Late fees
A late fee only works if the customer agreed to it before the work, so it belongs in the estimate's terms, not as a surprise on the invoice. How much you can charge, and whether you can charge interest, depends on your state, so check before you print a number. In practice, a friendly reminder the day after the due date collects more than a fee does.
Why the pay link matters more than the terms
The most common reason a homeowner pays late isn't the terms. It's that paying means finding a checkbook or calling you with a card number. A link in the text or email that opens a payment page, where they pay by card or bank in a minute, removes the excuse. Send the invoice the day the job is done, while the work is fresh and the customer is happy.
In Settle, converting an approved estimate to an invoice sets it due in 7 days, which you can change. The invoice goes out from your phone with a link the customer pays from by card, Apple Pay or bank, and the money lands in your own Stripe account. See how to get paid faster for the rest of the routine.
What payment terms should a contractor use?
For homeowners, due on receipt or net 7 (due within 7 days). Use net 15 or net 30 only for commercial clients or general contractors who require it. Print the actual due date on the invoice.
What does net 30 mean on an invoice?
Payment is due 30 days after the invoice date. Most customers who see net 30 pay near day 30, so it's a slow choice for residential work.
Can a contractor charge a late fee?
Usually, if the customer agreed to it in writing before the work started and the amount follows your state's rules. Put it in the estimate's terms. A reminder the day after the due date is often more effective than a fee.
Is "due on receipt" too aggressive?
Not for a repair or a one-day job. The customer has seen the work and the price. For larger jobs, take a deposit up front and make the balance due on completion.
Send your next invoice with a pay link.
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