JOINT CHECK AGREEMENTS, AND WHAT THEY REALLY COST.
A joint check is one check with two payees on it, and it can't be deposited until both of them endorse it. It exists because a supplier wants certainty that the material it's shipping gets paid for out of the money that job produces, and it's often the thing that lifts a credit hold or gets a subcontractor onto a job it couldn't otherwise buy material for. What it costs you is control and days. The money now travels through a second endorsement on somebody else's schedule, the supplier may be able to apply it against balances you didn't intend depending on how the agreement reads, and a receivable you could have allocated on Friday is already committed. What the agreement does to your lien rights, your waivers, and any claim is legal work, so your construction attorney reads it before you sign it.
The reason this decision gets made badly is that it never presents itself as a financing decision. It presents itself as a delivery problem on a Tuesday, with a truck that doesn't roll until somebody signs something. So the agreement gets signed by whoever is closest to the phone, and the business finds out what it agreed to in the week the money was supposed to cover payroll. A joint check is a reasonable tool used deliberately and a quiet loss of cash control when it's used to end an argument with a supplier.
WHAT IT MEANS.
A joint check agreement is an arrangement under which the party paying you issues one check made payable to you and to one of your suppliers or lower tier subcontractors together, so both endorsements are required before the money can be deposited anywhere.
It helps in a specific set of circumstances and they're worth being honest about. A supplier holding your account will often release material against a joint check when it won't release against a promise, which means the job proceeds instead of stalling. On a large material buyout the arrangement can also get you better terms than your own credit would support, because the supplier is underwriting the project's payment stream rather than your balance sheet. Those are real benefits and they're why the tool exists.
What it does to you is quieter. Every joint check tells the general contractor's accounting department that your supplier doesn't extend you credit, and that's information you can't take back. It also converts a receivable into a receivable with an owner, so the flexibility you had on the Friday it comes in is gone. Neither of those appears on any invoice, which is why the arrangement feels free at the moment it gets signed.
WHERE THE ARRANGEMENT TURNS EXPENSIVE.
It gets signed to solve a delivery problem, and never read
The request comes in as an operational emergency: material won't ship, the crew is on site tomorrow, and a document needs a signature today. Nobody reads what the agreement covers, which project it applies to, or how long it lives, because reading it's not what unblocks the truck. That's how a business ends up with an arrangement it can't describe and can't exit.
The second endorsement adds days nobody forecast
A direct payment is deposited the day it comes in. A joint check has to reach both payees, get endorsed by both, and then be deposited, and it moves at the speed of whichever party is slower. Those days are real cash days and they usually fall in a week that was already tight, because the reason for the joint check was a tight week in the first place.
The money can be applied somewhere you didn't intend
A supplier receiving funds from a joint check may apply them against balances other than the invoices you had in mind, and whether it can depends entirely on how the agreement and your account terms read. Contractors discover this by watching a $38,000 payment reduce an old balance on a closed job while the material for the current one is still on hold. That's a document question, which is the reason a document written by somebody else deserves a read by your attorney.
WHAT IT LOOKS LIKE IN DOLLARS.
Take a $95,000 pay application with a $38,000 joint check to a supplier inside it. Your usable cash from that payment is $57,000. If payroll that week is $61,000, the joint check decided your Friday before the check was written, and the decision was made weeks earlier by whoever signed the agreement. Nothing about the job changed. What changed is that a receivable you could allocate became a receivable that was already allocated.
Take a check issued on day one and mailed to the supplier, endorsed and forwarded on day eight, received and deposited by you on day ten, and cleared on day twelve. Against a direct payment deposited on day two, that's ten additional days of float on money already earned. Run three joint checks in a quarter and the arrangement has moved a month of cash timing, without anybody charging a fee.
HOW IT GETS USED ON PURPOSE.
We read it for what it does to your cash and your forecast. Your construction attorney reads it for what it does to your lien rights, your waivers, and any claim, because those consequences are legal and state specific and they can't be recovered from later. Both reads take a day. The truck can wait a day, and if it genuinely can't, that's worth knowing about the supplier as well.
Every pay application with a joint check inside it goes into the 13 week cash forecast at the amount you can really deposit, with the joint check portion and the added float shown separately. Forecasting the gross is how a contractor with a healthy looking receivables report misses payroll. The number you can spend is the only number the forecast should hold.
A joint check arrangement should be tied to the credit problem that created it, not to the customer relationship. That means knowing what has to be true for the supplier to release it, usually a current account and a run of payments made on terms, and asking for the release once those conditions hold. Arrangements nobody revisits become permanent, and permanent ones cost you every job.
Suppliers ask for joint checks when they doubt the timing of your payments, and that doubt usually starts with a collections routine or a mobilization line and not with your margin. Collections on a defined week and mobilization billed on the first pay application are what remove the reason the request gets made. That work costs nothing and it's the only permanent answer here.
THE OUTPUTS, NAMED.
FLAT MONTHLY FEE. NO SURPRISES.
Three tiers, priced by your trailing twelve month revenue. Which one you're in depends on how much of the work you want off your desk. No hourly billing, no payroll, and no add-ons.
Pricing
| Last 12 months revenue | Monthly fee |
|---|---|
| Up to $1M | $1,900 to $2,900 |
| $1M to $3.5M | $2,600 to $3,900 |
| $3.5M to $6.5M | $3,800 to $5,700 |
| $6.5M to $9.5M | $5,100 to $7,100 |
| $9.5M to $12.5M | $6,100 to $8,500 |
| $12.5M to $15.5M | $7,400 to $11,000 |
| $15.5M to $18.5M | $9,400 to $13,500 |
| $18.5M+ | Quoted individually |
Range reflects the three tiers below. Which one you're in depends on how much of the work you want off your desk. No payroll. No hidden line items.
You stop guessing.
You get the CFO work. Job costing built against the way you estimate, a 13 week cash forecast, monthly WIP, and a meeting every month that ends in decisions rather than a report.
Your bookkeeper keeps doing the books.
You stop touching the books.
Everything in Core, and we run the bookkeeping and the controllership as well. Nobody in your office is answering coding questions or chasing a reconciliation at month end.
We do the books. No payroll.
Every job shows its margin while it's still running.
Everything in Executive, plus the job costing and WIP platform set up, loaded with your cost codes, and managed for you every month. You never have to learn it.
We do the job costing.
FREQUENTLY ASKED.
