How Long Should Minnesota Contractors Wait Before Escalating Debt?

Editor’s Note: This is the third installment in an eight-part series of posts by Bill Gschwind, business and construction attorney and founder of Minnesota Construction Law Services. Bill brings years of experience helping contractors get paid without wasting time, leverage, or sanity.

Not every unpaid invoice needs to be sent to collections. Some customers are late because of genuine cash flow hiccups or simple forgetfulness. But many contractors wait too long to act, assuming that silence means good intentions – or fearing that taking action will damage the relationship.

What we’ve found at Minnesota Construction Law Services is that the real cost of waiting isn’t just time – it’s leverage. And leverage is the most important asset you have in a collection. Sometimes the smartest move is contacting a Minnesota collection lawyer sooner than you think.

So, let’s answer the question: how long should you wait?

0 – 30 Days: Expect Payment

The first 30 days after an invoice goes out are typically uneventful. If you’ve communicated clearly, have a solid contract, and did the work as promised, most good customers will pay promptly. But even now, you should be tracking every invoice internally. Set a follow-up reminder for Day 15. If the payment terms were “net 30” and nothing has arrived by Day 20, send a polite reminder.

This isn’t about pressure – it’s about consistency.

30 – 60 Days: Begin Escalation

Once a payment is 30 days late, it’s time to raise the stakes slightly. A second reminder – firm and professional – should reference the contract, the invoice number, and any late payment penalties if applicable.

Now’s also the time to confirm your lien deadlines. In Minnesota, most contractors have 120 days from the last date of work to file a mechanics’ lien. But if you don’t begin tracking those dates now, you risk losing your rights later.

This is also where internal A/R management becomes critical. If your office isn’t flagging overdue accounts and escalating them on a schedule, it’s far too easy for receivables to age out.

60 – 75 Days: Your Decision Point

At this stage, the likelihood of full collection is already declining. Customers who haven’t paid after two follow-ups often aren’t just busy – they’re choosing not to pay.

This doesn’t necessarily mean the relationship is over, but it does mean you need to act strategically. You have two choices:

1. Keep trying to collect it yourself and risk further delay.
2. Hand it off to someone who knows how to use the legal tools at your disposal.

At MNCLS, this is where we typically get involved. We review the file, confirm the contract terms, check lien rights, and send a professional demand backed by legal authority – not emotion.

75 Days and Beyond: You’re Losing Ground

If you’re still managing the debt internally past 75 days, you’re not collecting – you’re gambling. The longer the debt sits, the more likely:

• The customer spends the money elsewhere.
• Your lien rights expire.
• You make a business decision based on inflated A/R.
• You lose patience and act out of frustration instead of strategy.

That’s why we always recommend turning over the debt by Day 75 at the latest. Earlier is better.

Good Systems Make Escalation Easy

The most successful contractors we work with don’t guess. They use a simple internal system:

• 0–30 days: Monitor
• 31–45 days: Remind
• 46–60 days: Escalate
• 61–75 days: Hand it over

It’s not about being harsh. It’s about treating receivables like what they are – earned money that’s overdue. You don’t need to chase customers endlessly. You just need to set a clear timeline, communicate consistently, and escalate at the right time.

And when it’s time to escalate, we’re ready. MNCLS helps owner-operators preserve their leverage, protect their lien rights, and turn overdue invoices into collected revenue – without damaging your reputation or losing future business.

Stay Tuned: Will Filing a Mechanics’ Lien Help Me Get Paid?

We’ll explain what liens actually do, why they’re not just for collection, and how they can make or break your ability to recover what you’re owed.