Retainage and pay applications
Flooring retainage, through to release.
For commercial flooring contractors: how retainage and pay applications work, where retainage gets lost, and how to follow it from the first bill to the release.
How retainage works.
On commercial work, the general contractor or owner holds back a share of each progress payment until the work, or the whole project, is complete. The share is written into the contract, and many states limit how much can be held and when it must be paid. Retainage is money you have earned and not yet received, so it belongs on your books as its own receivable, not as a short payment. Good retainage billing follows that receivable from the first pay application to the release.
How pay applications work.
Commercial jobs bill on a schedule of values: each line of the contract, the work completed this period and to date, stored materials, retainage held and the amount due. Many general contractors use AIA-style forms, often G702 and G703, and set a monthly cut-off date. A pay application that misses the cut-off waits a month.
Where retainage gets lost.
- Retainage never recorded as its own receivable, so it drops out of the aging.
- The release never billed when the project closes.
- Lien waivers or closeout documents late, holding the release.
- Change orders never added to the schedule of values.
- Installer retainage released while that installer’s back charges are open.
What Bearwall does here.
Commercial billing differs contract by contract, so retainage and pay applications are scoped in the diagnosis: your schedule of values, your forms and your system are mapped first, and the quote says what Bearwall will run. The A/R aging is set up for you; how retainage shows in it depends on how your system records it, which the diagnosis maps.
General information for flooring contractors, not legal advice. Your contract and your state’s rules set the terms.
Questions
What is retainage in flooring?
A share of each progress payment that the general contractor or owner holds until the work or the project is complete. It is earned money not yet received, so track it as its own receivable, job by job, until it is released and paid.
When should retainage be billed for release?
When the contract’s release condition is met: often substantial completion, final completion or acceptance of closeout documents. Track that condition per job, bill the release as its own invoice, and follow it in the aging like any other receivable.
Does Bearwall prepare pay applications?
Pay applications are scoped in the diagnosis. Forms, cut-off dates and schedules of values differ by contract, so we map yours first, and the quote says exactly what Bearwall will run before anything is installed.