What is Pay when Paid Clause?

A Pay when Paid Clause in the vendor agreement requires payment to the subcontractor when the prime contractor gets paid by the project’s owner. A prime contractor’s obligation to pay is triggered upon receipt of payment. However, what happens if the prime contractor is underpaid or not paid at all? This is why Construction Factoring is a small subset of general factoring.

However, ECapital has worked with many subcontractors if their prime customer is a strong credit.

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