A signed statement of work is a promise. A received deposit is a fact.
Treat the signature and the deposit as one sequence rather than two workflows: the client signs the statement of work, the deposit is requested immediately after, and the notice that work is authorized to begin goes out when the money is confirmed received, not when it is promised. The gap between signed and funded is where unpaid work happens.
In most firms the engagement letter lives in a signature tool and the deposit lives in billing. The signature tool announces that the document is complete. Billing announces, eventually, that an invoice was paid. Nothing joins the two, so nothing can tell you the state that actually matters: signed, and not yet funded.
The work starts anyway. Not through carelessness, but because someone senior said the client had signed, and that sounded like a green light.
It is the same gap that shows up in trust funding and in financing rounds, on a smaller scale and with more repetition. Every engagement that starts unpaid is a small unsecured loan to a client, made by whoever did the work.
The amount, when it is due, and what it is for. If the deposit is a condition of starting, say so in the document rather than in the covering email.
The moment the client signs is the moment they are most willing to pay. A payment request that arrives three days later has lost that.
Card and bank collection give a processor confirmation. A wire or bank credit is confirmed against your own bank’s record. Either way, someone confirms, and a promise to pay does not.
The notice that work is authorized to begin is the output of the deposit clearing, not of the signature. That one ordering decision is the whole control.
The engagement file should show the executed document and the confirmed deposit together, with dates. Six months later, in a fee dispute, that pairing is the answer.
| Rail | Suits | What to know |
|---|---|---|
| Card | Ordinary deposits, immediate collection | Highest completion rate, processing fees on the receiving side, chargeback exposure for months |
| Bank debit | Larger deposits from established clients | Lower fees, and it can be returned days later, including as unauthorized by a consumer |
| Wire or bank credit | Large retainers | Effectively final on arrival, no percentage fee, and it needs the client to make an errand of it |
Termn adds nothing to the amount moved on any of them. Card and bank collection are processed into your own processor account at its ordinary rates and payout schedule, and a wire lands in your bank with nothing in between.
A client who is asked to pay before work starts is not being distrusted, and the way to make that obvious is to be exact: name the amount, name what it buys, and confirm receipt in writing the same day.
Three arrangements get called the same thing, and they behave differently when the engagement ends early. The document should say which one it means.
For regulated professions, what may be charged, what must be held for the client, and what must be returned are governed by conduct rules rather than by preference. Those rules, and your trust accounting, sit outside anything described here.
This is an explanation of how a transaction works, not legal or tax advice. Termn is not a law firm, a bank, an escrow agent, or a money transmitter, and it never holds your money. What is right for your situation is a question for your own counsel, who decides it and drafts the documents that carry it.
Termn runs the statement of work and the deposit as one agreement, so a signed-but-unfunded engagement is a visible state instead of a surprise.
How Termn runs a client SOW and deposit Your first workspace is free, and nothing goes out until you send it.
Money showing in the account is not the same as money you get to keep.
The file is finished when a stranger can read it without asking anyone anything.
Almost everywhere, yes. The exceptions are the documents you care most about.
Everything else is in the learning center.
Your first workspace is free: one live workspace, unlimited agreements inside it, no card.
Close your first deal freeRather talk it through first? Contact us at sales@termn.ai.