You haven't gotten any responses yet probably because your questions are 'way too broad for a forum response. I'd recommend a quick trip to your local bookstore to look at the Amherst offerings. Then you can ask more pointed questions.
A lot about when and how you ask for payment is based on how you want to do business and the kind of people you do business with.
In my case, working at the higher-end of portraiture and having a specific product--I don't do less than a 16x20 framed wall portrait--I have a thorough consultation with a prospective client and if they agree to schedule a session, they pay me half of the cost of that 16x20 wall portrait at that time.
That fee essentially covers all my costs up to the preview (sales) consultation session. At that point, they will decide to go with the minimum 16x20 or (preferably to me) something more. I'll ask for half of what the remainder of the total fee would be at that point, and collect the balance on delivery of the final products.
I do not work with a formal contract as such for personal commission clients, but with an initial form for my own purposes to make sure I have all their desires on paper. I'll record their order and provide them with an invoice on delivery.
I also have a satisfaction guarantee--if I can't provide them with a product that they're happy to have for my prices, I'll refund all their money, period. I'll offer free reshoots if necessary--my fees are sufficient to cover a few reshoots and returns per year, but as yet I've never had to do more than a couple of reshoots.
In those cases, I actually offered them when I saw at the preview session that they weren't exactly beaming at the previews. They probably would have made the purchase, but they wouldn't have been enthusiastic about it, and I depend on enthusiastic to gain more clients by word of mouth. So a reshoot in such a case is really just the cost of advertising.
