Booking a plot is the easy part. The hard part is the next five years: collecting the instalments on time, applying each payment to the right instalment, and knowing who is overdue today. Developers who lose track of collections lose cash flow, and cash flow pays for the next site. This guide describes a collection routine that works.
The problem with instalment collection
- Payments arrive irregularly. A customer pays two months at once, or half a month.
- Nobody knows what a payment covered. Was it March or April?
- Overdue amounts are discovered late. By the time someone looks, it is three months.
- Customers dispute balances. There is no clear statement.
All of this is solved by one rule: every payment is applied to the oldest unpaid instalment first.
The oldest-first rule
Take a customer with instalments of Rs 100,000 due in January, February and March. January is unpaid and the customer pays Rs 250,000.
| Instalment | Due | Amount | Paid from this payment | Remaining |
|---|---|---|---|---|
| 1 | Jan | 100,000 | 100,000 | 0 |
| 2 | Feb | 100,000 | 100,000 | 0 |
| 3 | Mar | 100,000 | 50,000 | 50,000 |
The payment settles the two oldest instalments in full and part-pays the third. There is no argument about what it covered.
A weekly collection routine
- List overdue instalments every week, oldest first.
- Contact the customer with the exact amount and the instalment numbers.
- Record each payment the day it arrives, with the reference.
- Send the customer a statement of what is paid and what is due.
- Escalate at a fixed point, for example after the third overdue instalment, according to your written policy.
- Review the total outstanding across all bookings each month.
What a good customer statement shows
A statement is the best way to end disputes before they start. It should list:
- The booking, the site and the unit.
- The total price, the advance and the balance at booking.
- Each instalment with its due date, the amount, what has been paid and what remains.
- Which instalments are overdue today.
Send it at a fixed time, such as the first week of each month, and whenever a customer asks. A customer who can see exactly what was covered rarely argues.
Common mistakes
- Applying payments to the newest instalment. The oldest then stay overdue forever.
- Delaying entry. A payment recorded a week later makes the weekly list wrong.
- No written policy. Staff do not know when to escalate.
- Waiving instalments verbally. Any change should be recorded with a reason.
How OneAccounts does it
Payments are recorded on a dedicated screen. Choose the active booking and the bank account, and the instalment schedule appears with each instalment's due date, amount, amount paid and status. Enter the amount received, and the system shows which instalments it will cover before you save. Payments are applied to the oldest unpaid instalment first, and instalments past their due date are marked Overdue.
A booking that is completed or cancelled does not accept further payments. The bookings list shows every booking's balance and status, so the total still to collect is always visible.
See plot booking and instalment accounting for developers and Construction accounting software.
Frequently asked questions
Can I choose which instalment a payment goes to?
The routine is oldest first, which keeps overdue instalments from piling up. This is the standard order in OneAccounts.
What if a customer pays more than the next instalment?
The extra covers the following instalments in order. The preview on the payment screen shows exactly which ones.
How do I see the total still to collect?
The bookings list shows each balance, and the total outstanding for active bookings.
Can a cancelled booking receive payments?
No. Completed and cancelled bookings do not accept payments.
Does recording a payment post to the accounts?
Yes. A payment is a receipt against the booking's invoice, into the bank account you choose.