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Trouble Collecting from Property Management Co

Discussion in 'Lawn Mowing' started by clallen03, Jan 17, 2008.

  1. clallen03

    clallen03 LawnSite Senior Member
    Messages: 514

    Im trying to find out if anyone has ever had trouble collecting from property management companies?

    We have been doing business with 4 property management companies this year. This is our first year working with them so we are a little naive to some of the things they do as far as payments are concern.
    Two of these companies contacted me around the early December time frame telling me the HOA is running low on funds. HOA dues are due on the 1st of January. They stated that the account should be replenished by the end of January, this is when they will start paying out the invoices that they have accumulated.
    Now my options were to stop all work and continue once the accounts were brought to a current status or continue services as they assured that payments will be brought to a current status by the middle of Feb.
    I elected to continue services because we were doing little to no work on these accounts during this time of year just driving by maybe picking up a couple beer cans (of course I didn't tell them that) but we continue to bill each month.

    Im just wondering if anyone has had this problem. Also looking for some advice on how to handle this situation.

    Thanks in advance
  2. Turf Dawg

    Turf Dawg LawnSite Gold Member
    Messages: 3,719

    My rule is three billings. When we send the third invoice the work stops. I know many of you think I'm crazy to take that long but this is just how some of the commercial pay. The only ones I've ever had to stop work on seems to be nurshing homes, and trust me when it looks bad they get money fast. I've seen alot of post on here about getting commercial accounts. Let me warn some of you, this is alot different than cutting Mrs Smiths' yard. Most of my commercial accounts take from 15 to 45 days to get paid from.
  3. topsites

    topsites LawnSite Fanatic
    Messages: 21,653

    Yes I agree, commercial accounts appear to require deeper pockets.
  4. juspayme

    juspayme LawnSite Senior Member
    Messages: 298

    hey at least they called you in december and let you know.

    maybe something came up, they had some big expenses.

    they will pay u.
  5. ed2hess

    ed2hess LawnSite Fanatic
    Messages: 14,455

    Some property manager are just poor. One thing is for sure they aren't going to take money out of their pocket to pay you and the HOA doesn't have many options except levy a one time amount and they aren't likely to do that. Often they simply don't watch the money and when a big insurance bill or other emergency comes in you get put on the burner. Be prepared to go a few months.
  6. bohiaa

    bohiaa LawnSite Fanatic
    Messages: 5,220

    Be sure to have a LATE FEE,

    this has saved my A#$ several times..
  7. clallen03

    clallen03 LawnSite Senior Member
    Messages: 514

    Both of these account renew in June but I dont think I'll be renewing these account. The money is good but the timing of the late payments could have really hurt my company if I wasn't prepared for something like this.

    I see why people discourage start up companies from doing business with commercial until their finances are stable enough to take a hit like this. This has caused me to start dipping into my personal account to keep thing afloat. Luckily Im the type that saves every penny I can. If not this would have been a recipe for disaster.

    So when they say "dont deal with commercial until you are really ready", this is what they are talking about.
  8. DuraCutter

    DuraCutter LawnSite Senior Member
    Messages: 806

    True that. We did some rockbeds for a condo in 07 and they wound up giving us payment in postdated cheques through may/08.

    Sometimes doing commercial work with Prop mgrs will test your patience and your overdraft. :laugh:

    Good luck.


    Forgot to mention the dollar amounts were near 40k, so nothing to snicker at. It can hurt any company.
  9. d&rlawncare

    d&rlawncare LawnSite Senior Member
    Messages: 741

    I would renew and up your late fees to the highest your allowed for your state for this next contract.
  10. JimLewis

    JimLewis LawnSite Fanatic
    Messages: 6,872

    Yah, we had these problems all the time. That's why I don't do commercial work, work for property management co.'s, HOAs, Realtors, Developers, apartment complexes, etc. We strictly work for residential homeowners. And even with them, I make them sign up for AutoPay.

    NOT getting paid is NOT cool.

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