Collections: the ladder from reminder to demand letter to lien to small claims, and when to hand it to a lawyer
In one paragraph
Most unpaid invoices are paid with a reminder. The rest move up a ladder with a date at each rung: a written demand citing the contract and the statutes, the preliminary notice and lien clock you already started, a stop payment notice if a GC is the problem, small claims for up to $12,500 if you are a sole proprietor or $6,250 for an entity, and a construction attorney for anything larger or anything involving a lien foreclosure. Two rules run through every rung: you must have been licensed the whole time, and you never threaten anything the statute does not let you do.
The rule
Small claims court hears claims up to $12,500 brought by a natural person (CCP 116.221) and up to $6,250 for other plaintiffs such as corporations and LLCs (CCP 116.220(a)(1)). An owner who does not pay an undisputed progress payment within 30 days of a written demand owes a 2% per month penalty and attorney fees (Civil Code 8800). A lien must be recorded within the 8412/8414 windows and foreclosed within 90 days of recording (8460). None of it is available to a contractor who was not duly licensed at all times (B&P 7031(a)).
Why it matters
The unpaid final is the moment a new contractor either has a calendar and a file or has a grievance. The calendar says when the lien dies; the file holds the signed contract, the change orders and the releases; and the demand letter, sent early and calmly, gets most of the money without a courthouse. The rest is deciding which court, and that turns on your entity type.