Three months into owning a business, it happened to me.

A client refused to pay.

And by “refuse” I mean he completely ghosted me. Emails are bouncing back. Texts and calls are blocked. Website is shut down.

Most entrepreneurs will tell you that this happens to all of us at some point and, unfortunately, they would be right. And when they say all they mean all. Even the smart ones, even the prepared ones. I had him sign a contract, I have all of his contact information, he even paid me once before.

None of that matters. Sometimes, the truth is, things just happen. But there are ways small business owners can protect themselves.

Three Tips To Avoid Getting Stiffed

1. Research Your Client

Just like you might Facebook stalk a date, you should consider doing some recon on clients before doing business with them. If they’re a business owner, check out their website, social media profiles, Yelp reviews and pour over emails they’ve sent you with a fine-tooth comb. The following are red flags:

• No website

• Bad reviews on Yelp, Facebook or Google

• No social media profiles, or blank profiles

• Lack of contact information on their website, profiles and in their emails

• If they ask to pay with cash

• If they never refer to you by name or misspell your name

• Poor spelling (this may just be a copywriter thing, but in my opinion anyone who can’t spell gets a raised eyebrow from me)

If anything seems off to you, trust your gut and consider avoiding doing business with them. If you’re really hurting for the cash, do your due diligence and get a reference check. If they refuse to offer you references, this is yet another red flag.

2. Use An Iron-Clad Contract

A lawyer’s job is to protect you, except instead of swords and shields they have the law and their big ol’ brains. It’s essential that you have a bonafide contract written by a real lawyer before you sign any clients. I’ll be honest — contracts can be expensive. But you know what’s more expensive? Getting shysted over and over again by clients who know they can take advantage of you.

There are many excellent contract template shops online specifically for business owners who are ballin’ on a budget. Please please please do yourself a favor and purchase a contract template as soon as you open your business so when you sign your first client, you will look like a pro and get paid like a pro.

3. Require A Deposit

It’s not at all uncommon to request a deposit for work upfront, and this is one way you can avoid getting burned by clients who don’t pay their invoices. To do this, make sure the “fees” or “payment schedule” sections of your contract stipulate that you require X% payment upfront, and then the remaining balance at another date. I recommend 50% upfront, but you do what makes you comfortable. Bonus tip: if your spidey-senses are still going off about your client, require the rest of the balance be paid before you deliver the final work. If they ghost you, yes you’ll be out of the cash they owed, but at least the jerk won’t also be benefitting from the work you did.

What To Do If A Client Doesn’t Pay The Invoice

If a client ends up ghosting you before you get paid, there are a few things you can do to try and get paid:

1. Send them invoice reminders via email, text and snail mail. Yes, I recommend you do all three. They’ll take you more seriously. In the reminders, make sure it’s clear when the invoice was due, how they can pay it now, and the consequences if they don’t (For example, “On Aug. 1, I’ll begin charging a late fee of 3% per month).

2. Reason with them. If they contact you and admit that they can’t pay, give them a one-time offer of 50% off if they pay now. This might be enticing if they’re worried about legal action and you’ll get some of the money you’re owed.

3. Have your attorney write them a letter. Most attorneys will do this for a very low fee, and it could scare them into paying up.

4. Sue them and take them to small claims court. The benefit of this action is you might get your money, and you’ll show them that you stand up for yourself. The downsides are that the attorney fees might be more than the money you’re after, and small claims courts has financial limits. Typically small claims court only takes cases that dispute $3,000 – $10,000. If what you’re owed is less than that, there’s not much you can do in court.

5. Send them to collections. There are also pros and cons with this idea. Cons: You typically owe the collections agency 50% of the amount they collect, and many collection agencies only want to go after large invoices (several thousands of dollars or more). Pros: You stick up for yourself and possibly get some of the money you’re owed.

6. Write off the loss on your taxes. According to the IRS, this is called a business bad debt. You should talk to your accountant about this, but it could be a way to save a few dollars by showing you had a lower income than expected. This only works if you’re a business owner; typically freelancers can’t write off business debts.

What If They Still Aren’t Paying?

Unfortunately, this is the name of the entrepreneurship game. Some clients just don’t pay, whether that’s because they file for bankruptcy, or close their business, or move to Guam just to avoid you. If this happens to you — like it happened to me — don’t get down on yourself and use this as a learning experience.