The notice deadline beats the payment deadline
Forty-five days to object, sixty to pay. A party who withholds without having given the earlier written notice is in a materially worse position than one who simply paid late.
Virginia · Code § 11-4.6
Business financing in Virginia
In 2023 Virginia did something most states have not: it made pay-if-paid unenforceable. A general contractor can no longer make your payment conditional on the owner paying him first. The clause may still be printed in your subcontract. It no longer works.
- Not a lender
- No fee to apply
- No credit pull to check fit
The Virginia payment clock
Sixty days, and a notice deadline before each one.
Virginia pairs every payment deadline with an earlier deadline for objecting. Miss the notice and the objection is worth much less.
- An owner pays the general within 60 days
Under § 11-4.6, the owner pays within sixty days of the invoice. If the owner intends to withhold, the written notice of withholding is due earlier — within forty-five days — and it has to identify the contractual noncompliance.
- The general pays a sub on the earlier of two dates
Whichever comes first: sixty days from the invoice, or seven days after the general receives the owner's payment. A general holding money for three weeks after being paid is already late. His own notice of withholding is due within fifty days.
- Pay-if-paid clauses do not survive
Section 11-4.6 makes owner payment not a condition precedent to subcontractor payment, and voids any clause to the contrary. This is the provision that changes how a Virginia receivable is underwritten: the sub's right to be paid no longer depends on the owner's behaviour.
- Public work runs faster at the top
A state agency pays within thirty days under § 2.2-4347; a locality has forty-five. The flow-down under § 2.2-4354 mirrors the private rule at sixty days or seven days after payment. Interest on late public payments tracks the Wall Street Journal prime rate under § 2.2-4355.
- Public retainage is capped at 5%
Section 2.2-4333 requires payment of at least ninety-five percent of the earned sum — a five percent ceiling on public work. Private work in Virginia has no statutory retainage cap at all, so whatever your contract permits is what may be held.
- Ninety days to record, then a second clock
A memorandum of mechanic's lien is due within ninety days of the last day of the month in which you last performed work, and never later than ninety days from completion of the structure (§ 43-4). Only sums from the preceding one hundred and fifty days may be included. Suit follows under § 43-17: within six months of recording, or sixty days after completion, whichever occurs last.
Private retainage is uncapped
Virginia caps retainage on public work at five percent. It sets no ceiling on private work. A subcontract permitting ten percent is enforceable, and that money sits on your balance sheet until release.
The 150-day lookback bites
A lien memorandum reaches back one hundred and fifty days for includable sums. On a long job with slow billing, work performed before that window can fall outside the lien even though the memorandum itself is timely.
Financing routes
What Virginia contractors actually use.
A sixty-day statutory clock still means sixty days of payroll you carry first.
01
Invoice financing Invoice financing
Advance against the receivable rather than carrying it for sixty days — now a cleaner instrument in Virginia, because the sub's right to payment no longer hangs on the owner.
02
Working capital Working capital
A lump sum sized to a dated inflow: the draw you can see coming, the retainage release you have been promised.
03
Lines of credit Line of credit
A standing cushion for the gap between the forty-five-day notice and the sixty-day payment, repeated across concurrent jobs.
04
Bank declined? Declined by a bank
Being turned down by a bank is a statement about the bank's underwriting box, not a verdict on the business.
Lender fit
What a funding partner looks at in Virginia.
None of this is a credit decision. It is what tends to move a file from maybe to yes.
The strength of the payer
On invoice financing, the question is whether the party who owes you pays. Virginia's ban on pay-if-paid makes a subcontractor's receivable materially more financeable than the same paper in a state that still permits the clause.
Whether notice was given
If a payment is being withheld, a lender wants to know whether the withholding party met the forty-five or fifty-day notice requirement. An improper withholding is a stronger receivable than a properly noticed one.
Deposits over declared income
Alternative lenders read the last several months of bank deposits. A seasonal trough is explainable; an unexplained gap is not.
Virginia questions
What contractors ask before they apply.
Direct answers, with the section number so you can check them.
Are pay-if-paid clauses enforceable in Virginia?
No. Since 1 January 2023, Code § 11-4.6 has provided that payment by the party contracting with the contractor is not a condition precedent to payment of a subcontractor, and that any contract provision to the contrary is unenforceable. The clause may still appear in your subcontract; it does not bind you.
How long does an owner have to pay in Virginia?
Sixty days from the invoice under § 11-4.6, with any written notice of intent to withhold due within forty-five days. A general contractor must pay a subcontractor on the earlier of sixty days from the invoice or seven days after receiving the owner's payment, with his own notice of withholding due within fifty days. Public work is faster at the top: thirty days for a state agency, forty-five for a locality (§ 2.2-4347).
How much retainage can be held in Virginia?
On public work, no more than five percent — § 2.2-4333 requires payment of at least ninety-five percent of the earned sum. On private work, Virginia sets no statutory cap, so the contract controls. Note that the ten percent figure often quoted for Virginia comes from § 43-4 and is the maximum retainage that may be included in a lien memorandum, not a limit on what an owner may hold.
When must I record a mechanic's lien in Virginia?
A memorandum of lien must be recorded within ninety days of the last day of the month in which you last performed work, and in no case later than ninety days from completion of the structure (§ 43-4). Only sums from the preceding one hundred and fifty days may be included. Suit to enforce follows under § 43-17: within six months of recording, or sixty days after completion, whichever occurs last.
Is Crewline a lender?
No. Crewline is a referral and matching service. Applications are passed to a third-party funding partner who makes the credit decision on their own criteria. You are never charged a fee to apply, nothing here is a commitment to lend, and no approval is guaranteed.
Virginia
The clause is dead. The sixty days are still real.
Tell us what you are building, who owes you, and when the money is supposed to land. It takes a few minutes, costs nothing, and does not touch your credit file.
- Owner pays general
- 60 days
- Withholding notice
- 45 days
- Public retainage
- 5%
- Pay-if-paid
- Unenforceable
Crewline is a referral and matching service, not a lender. We do not make credit decisions or guarantee approval. Financing is provided by third-party lenders subject to their own terms and criteria.