Your builder asks for a pay application instead of an ordinary invoice. Use the agreed form to show the current draw against the contract amount and previous billings. AIA’s payment forms combine a summary with a continuation sheet supporting the progress figures. AIA payment application guide.
Start with your subcontract’s billing requirements. Use the suggested process below to prepare the documents. It does not set a national residential billing form or supply a lien-waiver template.
Choose the form your contract requires
AIA G702 is the contractor’s application and the architect’s certificate for payment. G703 supports it with a schedule of values and line-item information. AIA also offers G702S and G703S specifically for a subcontractor applying to a contractor. AIA payment-form FAQ, AIA G702 guide.
Choose the form the parties’ contract requires. Ask who receives the package, who reviews the trade progress, and who certifies or approves the amount. Do not assume every residential job has an architect certifying the sub’s payment.
If the builder supplies its own form, ask for instructions and a completed example with private customer data removed. Confirm how the form handles changes, stored materials, retainage, and prior billings. Keep that explanation with the job file.
Use a pay application when your agreement requires one. For a short scope billed on completion, confirm whether the buyer accepts an ordinary invoice. Check the contract and buyer’s instructions. Do not choose a form based on the house’s price or size.
How it differs from an invoice
Use this table to discuss the buyer’s required package. The invoice column is a suggested ordinary billing format; the pay-application column reflects AIA’s described structure. AIA payment application guide.
Scroll to read all columns.
| Review item | Ordinary invoice workflow | Formal pay-application workflow |
|---|---|---|
| Current request | Identifies the work and amount billed | Shows the current request within cumulative project values |
| Scope breakdown | Agreed invoice line items | Schedule-of-values lines supporting the summary |
| Prior billing | Separate account reconciliation if needed | Prior certified or approved amounts shown in the form |
| Changes | References agreed extras | Reconciles approved changes with the contract value |
| Review | Buyer’s agreed invoice process | The agreed application and certification or approval route |
Both need accurate records. A detailed form does not prove unfinished work is complete. An invoice cannot replace a required pay application unless the buyer agrees.
Set the schedule of values before billing
AIA’s continuation sheet organizes scheduled values, prior work, current work, stored materials, balances, and retainage. AIA G703 explanation. Agree the line items with the builder before the first application.
Use line items the reviewer can match to your agreement and progress on site. If rough-in and trim-out have different completion triggers, ask whether they should be separate lines. Avoid splitting the scope merely to produce an earlier draw.
Check that the schedule totals match the agreed contract amount. Show approved changes separately from the original scope. If the buyer changes the line structure, agree how prior applications will carry forward before entering new figures.
Record how progress will be measured for each line. Ask whether a milestone requires installation, inspection, completion of a whole area, or another stated condition. Keep those conditions with the form so the next preparer uses the same measures.
Build the current request from checked line items
Start with the most recent agreed billing record. Check each line against the work on site and its supporting records. Confirm what is newly complete and what you billed before.
AIA’s guidance recommends completing the continuation sheet first and using the most recent version when carrying line items forward. AIA application preparation instructions. Do not start from an old draft simply because it is the easiest file to find.
Check the arithmetic below against your form’s definitions:
- Original contract value plus approved changes gives the current contract value.
- Eligible completed work and eligible stored materials form the gross earned amount.
- Subtract the applicable retained amount to identify the earned amount after retainage.
- Subtract prior certified or approved amounts to derive the current request.
The fields and detailed calculation rules depend on your chosen form. AIA payment application guide. Ask the reviewer to explain any difference between approved billings and payments received. Record both separately.
Check that you have not billed the same progress twice. If stored materials from the previous application are installed, confirm how the form moves their value. Do not leave the same value in stored materials and bill it again as new installation.
Check eligibility before claiming stored materials
Ask whether the contract allows payment for materials not yet installed. Confirm the documents and location information the buyer requires. AIA’s form includes stored-material information, but that field is not permission to bill any order you have placed. AIA G703 instructions.
For each claim, identify the material, its scope line, storage location, and records showing its status. Ask the builder and insurer about protection, ownership, and any off-site storage conditions before assuming it qualifies.
Keep purchase orders separate from delivery records. If the material is not eligible for the current application, show it in your purchasing file rather than presenting it as approved progress.
Attach backup that answers the review question
Build the attachment list from the contract and buyer’s instructions. You can organize the requested backup by claim:
Scroll to read all columns.
| Claim being reviewed | Backup to agree with the buyer |
|---|---|
| Work installed in a particular area | Dated progress photos and location description |
| Milestone requiring an inspection | The relevant official inspection result |
| Approved extra work | Signed or otherwise approved change record |
| Hourly or quantity-based scope | Contract-required time or measurement records |
| Stored-material claim | Eligible purchase, delivery, storage, and protection evidence |
| Prior billing | Previous approved application and payment reconciliation |
Tie each attachment to a line or milestone. State what remains incomplete. Ask the reviewer to identify disputed progress by line so you can correct that record instead of guessing at a new total.
Match waivers to the payment transaction
Ask your construction attorney which waiver or release is appropriate for the jurisdiction and transaction. Check the claimant, project, amount, covered period, exceptions, and payment condition before signing.
Review the release wording against the retained balance and the specific payment transaction.
California’s licensing board illustrates the distinction between conditional and unconditional releases, and between progress and final releases. Its conditional progress form becomes effective on actual payment. Those are California forms and rules, not a North Carolina template. California CSLB waiver explanations.
For North Carolina, section 44A-12(f) restricts specified anticipatory waivers given in consideration for awarding a contract, while permitting specified releases or subordination. N.C. Gen. Stat. § 44A-12(f). Have counsel review the payment form. A “progress” heading alone does not tell you what rights it releases.
Keep the submitted application, any conditional release, the payment record, and any later release linked in your private file. Record what each document covers. Do not mark unpaid amounts as received to finish the package.
Track approval and payment separately
Track the submission date, revision request, approved amount, and actual receipt. Lender review or builder approval does not mean the money has reached your account. Ask for the date and responsible contact at each step.
North Carolina’s Chapter 22C payment provisions have residential exclusions. N.C. Gen. Stat. § 22C-6. Ask counsel which law and contract terms govern your job instead of assuming the same legal payment deadline applies to every application.
Save the final version and mark earlier versions as replaced. Carry any corrected line through the summary and the next application. Use the subcontractor invoice guide for submission and follow-up practices.
Keep sensitive records private
Remove bank and tax identifiers from circulated backup. Keep the full records in restricted accounting files. FTC record protection.
For year-end reporting after the payment records are reconciled, follow the subcontractor 1099 workflow.
Where Cercha fits
Cercha’s profiles, portfolios, and endorsements help you introduce your trade business. Messages helps you discuss whether a builder’s scope fits your work. Keep pay applications and payment approvals in the parties’ agreed project process. Ask about the beta.