Demand Letter for Payment of an Unpaid Invoice
A final demand for an overdue invoice that is firm without overstepping. Enter the invoice amount, the payments received and the late fee — the balance and the total now due are calculated, and the letter states a clear deadline and what happens next.
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A general template, not legal advice — review it before you use it. Draftmill is not a law firm.
Summit Line Builders LLC
1820 E. Sprague Avenue, Suite 4, Spokane, WA 99202
(509) 555-0147 · office@summitline.example.com
October 10, 2026
By certified mail, return receipt requested, and by email
Northgate Family Dental, PLLC
Attention: Dr. Laura Kim
4410 N. Ash Street, Suite 200, Spokane, WA 99205
Re: Final demand for payment — Invoice No. 2026-207 dated August 9, 2026
Dear Dr. Kim:
I am writing about Invoice No. 2026-207 dated August 9, 2026, which Summit Line Builders LLC issued for the tenant improvement work at your office, including the new reception area, two treatment rooms and the related plumbing and electrical work, performed under our tenant improvement contract dated June 12, 2026. The invoice was due on September 8, 2026. Despite our earlier reminders, it has not been paid in full, and we have received no written objection to it.
The amount now owed is:
Amount invoiced | $18,450.00 |
Payments received to date | $9,000.00 |
Balance due | $9,450.00 |
Late fee under our agreement | $283.50 |
Total now due | $9,733.50 |
Please pay the total now due, $9,733.50, no later than October 24, 2026. You can pay by check payable to Summit Line Builders LLC, mailed to the address above, or by ACH transfer using the bank details shown on the invoice.
If you believe that any part of this amount is not owed, please tell me in writing before that date and explain why, so that we can try to resolve the matter. Please pay any undisputed portion by the same date.
If we do not receive full payment or a written response by October 24, 2026, we intend to pursue the remedies available to us without further notice. These may include:
filing a lawsuit to recover the amount owed, including in small claims court where the amount qualifies;
referring the account to a collection agency;
recording a mechanic's or construction lien where state law gives us that right; and
seeking interest, court costs and attorneys' fees to the extent our agreement or the law allows.
We would much prefer to settle this without further action and to continue our working relationship. Nothing in this letter waives any of our rights or remedies under the agreement or the law.
Sincerely,
______________________________
Michael Reyes
Managing Member, Summit Line Builders LLC
Enclosure: copy of Invoice No. 2026-207
What it's for
A demand letter is the last step before formal collection: it states exactly what is owed and why, sets a deadline, and tells the customer what you will do if it passes. Many overdue invoices are paid at this stage, and if they are not, the letter shows a court that you asked for payment and gave the customer a chance to respond.
No federal law requires a demand letter; your agreement and state law govern the debt, including any late fee or interest — charge only what your contract or a state statute allows. The Fair Debt Collection Practices Act (15 U.S.C. § 1692 et seq.) governs third-party debt collectors collecting consumer debts; a business collecting its own invoice in its own name is generally not a “debt collector” under it, and business-to-business debts are outside it altogether. Some state laws, such as California's Rosenthal Act, also cover creditors collecting their own consumer debts. Never threaten arrest, criminal charges or any action you don't intend to take.
The template is pre-written for a contractor whose business client has not paid the balance of a final invoice. It works for any business invoice — change the description of the work and the next steps you may take.
What it should include
- your business name and contact details, and the date
- the customer's name and address, and the person responsible for payment
- the invoice number and date, and the agreement it is based on
- the amount invoiced, payments received and the balance due
- any late fee or interest your agreement allows, and the total now due
- a specific deadline and how to pay
- the steps you will take if the deadline passes, stated factually
How it works
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Frequently asked questions
What should a demand letter for an unpaid invoice include?
The invoice number, date and amount, the payments received, the balance due, any late fee or interest your agreement allows, a specific deadline (10 to 14 days is common), how to pay, and what you will do if the deadline passes. Keep it factual and firm, and never threaten action you don't intend or aren't allowed to take. Contractors should check their lien deadline first: it usually runs from the last day of work — in Washington, for example, a lien must be recorded within 90 days after the last labor or materials were furnished — and a demand letter does not extend it.
How should I send a payment demand letter?
Send it by certified mail with return receipt requested, which gives you proof of mailing and delivery, and email a copy so it arrives quickly. If your contract has a notice clause, follow it — the address, the method and the person named there. Keep a copy of the letter, the receipt and any reply; some small claims courts ask whether you requested payment before filing.
Can I take an unpaid invoice to small claims court?
Often, if the amount is within your state's small claims limit. Limits range from a few thousand dollars to about $25,000 depending on the state, and some states set a lower limit for businesses: Washington, for example, allows claims of up to $10,000 by individuals but $5,000 by businesses. Some states don't allow lawyers to appear in small claims court, so a business is represented by an owner or employee. Check your local court's website for the current limit and filing rules before you decide.
This template is a general starting point. Draftmill is not a law firm and does not provide legal advice; using a template creates no attorney–client relationship, and we do not guarantee that it is correct or suitable for your situation. Laws differ from state to state — adapt it to your situation, and have important contracts reviewed by an attorney licensed in your state. Terms of Service
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