Pay-when-paid
Last updated: August 2026
A pay-when-paid clause makes a contractor's obligation to pay a subcontractor or supplier contingent on the contractor first being paid by the owner. As a timing clause it delays your money; written as pay-if-paid, it can shift the owner's default risk onto you.
The short version
Enforceability varies by state and wording — many states read it as timing only; pay-if-paid needs explicit language and is void in several states. The practical effect is the same everywhere: the wait becomes yours. Full guide: pay-when-paid clauses, explained →
Taking the clock off your balance sheet
Yellowpay pays the invoice within 2 business days and takes the buyer credit risk, so the pay-when-paid clock runs on our money, not yours.
Related terms
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