Cat Credit

[nosparkplugs]

Opened an account with the Local Cat dealer to rent equipment. Geeze it was like applying for a loan. In Memphis, TN to rent Cat equipment you must have a 650 credit score or higher, and a Dunn & Bradstreet credit rating of 3 or less.
Anyway I was able to get my hands on a Cat 277C track skid steer for two days WOW what a nice machine compared to the ASV's I was renting in the past. Also Cat rents every attachment they sell

The Finance lady at the Cat rental store, said Ironically Cat requires a Dunn & Bradstreet score to rent or qualify for a Cat Loan, but does not report to Dunn & Bradstreet if you purchase a piece of Cat equipment.

[ksss]

Opened an account with the Local Cat dealer to rent equipment. Geeze it was like applying for a loan. In Memphis, TN to rent Cat equipment you must have a 650 credit score or higher, and a Dunn & Bradstreet credit rating of 3 or less.
Anyway I was able to get my hands on a Cat 277C track skid steer for two days WOW what a nice machine compared to the ASV's I was renting in the past. Also Cat rents every attachment they sell

The Finance lady at the Cat rental store, said Ironically Cat requires a Dunn & Bradstreet score to rent or qualify for a Cat Loan, but does not report to Dunn & Bradstreet if you purchase a piece of Cat equipment.


What does the D&B score represent. I have a Dunns number for Gov. work but I am not familiar with their rating system.

[jcbgm]

To oversimplify....

You have a FICO score for your personal credit rating and you have a DnB score for your business credit rating.

http://www.dnb.com

[Gravel Rat]

I think its tightened up now with the credit crisis so companies are not renting out or lending money willy nilly anymore.

H*ll I don't even know if plastic is even trusted in the USA anymore with the credit problems.

I think once the first rental maybe the second one it won't be like pulling teeth.

[AWJ Services]

The Cat dealer here also wanted me to sign a Personal Guarantee so I told them to forget about it.They called back and OKed me anyway.

[bobcat_ron]

Every business has to be aware of who their customers are, no more "yeah the cheque is in the mail there 'eh!"

[Gravel Rat]

I heard for Ron its C.O.D :laugh:

I think Caterpillar has learned not to be so lax with their financing I think the dealers have gotten burned pretty good with this economic down turn. People that couldn't pay their loans back and now Cat dealers are stuck with half paid for equipment and no market for it.

It used to be the saying the only reason why people bought Cat equipment because they offered the easiest financing.

[BrandonV]

yeah but they'll rent you anything from a skid to a d9 its not like doing business with the home depot. they're entrusting you with some major $$ in machinery.

[nosparkplugs]

Did I mention you must fully cover the cost of the piece of equipment on your business insurance, most insurance companies will not add & take off rental equipment coverage, so you must pick an amout and carry it always. Yes the first Cat rental was a hassle I felt like I should have just purchased the 277C buy the time I was done!!! I was able to qualify for Cat credit even though I was only renting that gives me Net30 to pay on Cat rentals, and yes the economy has caused Cat to tighten it's belt up BIG TIME. We have followed a tight budget for our personal & business finance's for over 7 years it was tough to watch the "JONES" get ahead, but Ohh! how it feels good now to have lived within our means. Bad credit is the norm now, if you got 600 FICO or higher that is about a 800 FICO three years ago.

According to many sources/ Fair issac, less than 20% of credit worthy folks have a 600 FICO score or higher now.

[jcbgm]

Did I mention you must fully cover the cost of the piece of equipment on your business insurance, most insurance companies will not add & take off rental equipment coverage, so you must pick an amout and carry it always.

I believe that most insurance companies WILL add & take of rental equipment coverage. A good contractor's liability policy will cover rental equipment up to a specified value for 90 days without naming it on the policy. We have most of our customers name us on their blanket coverage. We then REQUIRE certificates of coverage on machines that will be out on long-term rent, or high cost machines (dozers, ADTs, full size excavators).

[nosparkplugs]

That is true, and for most rental place's like NES Hertz or Dixie Rents don't even ask to be named or added to policy. Cat Requires their exact name on the policy & equipment value. For me State Farm will not do this unless you keep them on their for longer than 90 days, my agent has made exceptions when I was smaller, but renting from Cat would be an issue, since they want full coverage period equipment worth 50K Cat requires 50K period. Most liability does not cover total rental equipment loss, Now if it's your own(you own it) you good; which is covered under your inland Marine policy. Anyway I have added 75K equipment rental to my policy that should cover my rental needs for another season
I believe that most insurance companies WILL add & take of rental equipment coverage. A good contractor's liability policy will cover rental equipment up to a specified value for 90 days without naming it on the policy. We have most of our customers name us on their blanket coverage. We then REQUIRE certificates of coverage on machines that will be out on long-term rent, or high cost machines (dozers, ADTs, full size excavators).

[RockSet N' Grade]

NoSparkPlugs........since a 600 fico is like an 800 three years ago, I'm feelin' that 53 years of age is the new 30 something........now, if the chicks can just get behind that kinda thinkin'.........

[iron peddler]

so tell me this....if Cat gets lazy(like home loans) you guys won't care if rentals rates double? why is it wrong for a rental house to be tough? renting equipment from a hammer up to an D9 is a costly business....we live in a cover your ass world right now, so if you want to play, there has to be some rules to keep everyone honest....even huge companies take adavantage of lax rules.

[ksss]

so tell me this....if Cat gets lazy(like home loans) you guys won't care if rentals rates double? why is it wrong for a rental house to be tough? renting equipment from a hammer up to an D9 is a costly business....we live in a cover your ass world right now, so if you want to play, there has to be some rules to keep everyone honest....even huge companies take adavantage of lax rules.


If you take that one step further, every customer you do work for you are extending them credit of some sort. Even if you get a portion down, you still are extending them credit without any check of their ability or history of paying their debt. Every other relationship that a contractor is apart of, be that the bank, material provider or CAT credit or whomever has updated their procedures to protect themselves, except the contractor to customer relationship, that seems to be stuck in the good ol' boy system of honor, which is problematic to say the least (ask me how I know, after writing off more bad debt last year than almost my entire exsistance combined). Is it a bad idea to hand the customer a credit history form, and process them as everyone else does to you when you want credit? I suspect they would tell you to pack sand, but maybe not.

[iron peddler]

great points ksss, i think you all would be suprised how much bad debt rental stores right off each year.

[stuvecorp]

great points ksss, i think you all would be suprised how much bad debt rental stores right off each year.

Wow, I wouldn't think guys would stiff the rental place? You can't do work if you can't get equipment.

[charlesp]

If you take that one step further, every customer you do work for you are extending them credit of some sort. Even if you get a portion down, you still are extending them credit without any check of their ability or history of paying their debt. Every other relationship that a contractor is apart of, be that the bank, material provider or CAT credit or whomever has updated their procedures to protect themselves, except the contractor to customer relationship, that seems to be stuck in the good ol' boy system of honor, which is problematic to say the least (ask me how I know, after writing off more bad debt last year than almost my entire exsistance combined). Is it a bad idea to hand the customer a credit history form, and process them as everyone else does to you when you want credit? I suspect they would tell you to pack sand, but maybe not.
suggest you join one of the background check companies and do a little background check if the customer has even bounced a check it will be listed along with every address, yearly income, phone numbers,mortgage ect.not fool proof but will tell you a little bit about them as to whether to ask for a contract or up front money.cut my losses by about 75-80% and they will never know unless you tell them.59.00 a year saved [est app 60,000.00 of write offs first year not to mention att fees

[SiteSolutions]

so tell me this....if Cat gets lazy(like home loans) you guys won't care if rentals rates double? why is it wrong for a rental house to be tough? renting equipment from a hammer up to an D9 is a costly business....we live in a cover your ass world right now, so if you want to play, there has to be some rules to keep everyone honest....even huge companies take adavantage of lax rules.

I don't know closely tied the Cat stores are to their financing arms, but the Bobcat dealer here has no idea of my relationship with Ingersoll Rand credit. That insulation has allowed them to actually lower their rental prices maybe 33% or better over the last six months. They are so cheap now, I wouldn't dream of going anywhere else if they have the attachment or machine I need. In a slow market, cutting prices is one way to keep business going. If I were Cat, I would hate to have to raise rental prices right now in this competitive and slow market.

[SiteSolutions]

If you take that one step further, every customer you do work for you are extending them credit of some sort. Even if you get a portion down, you still are extending them credit without any check of their ability or history of paying their debt. Every other relationship that a contractor is apart of, be that the bank, material provider or CAT credit or whomever has updated their procedures to protect themselves, except the contractor to customer relationship, that seems to be stuck in the good ol' boy system of honor, which is problematic to say the least (ask me how I know, after writing off more bad debt last year than almost my entire exsistance combined). Is it a bad idea to hand the customer a credit history form, and process them as everyone else does to you when you want credit? I suspect they would tell you to pack sand, but maybe not.

I have been thinking about this a lot this past week as I wait for a homebuilder to pay for the work i did at the end of April. It's a real stress builder when you know the work was done right, they like the work, and yet... no check.

[ksss]

suggest you join one of the background check companies and do a little background check if the customer has even bounced a check it will be listed along with every address, yearly income, phone numbers,mortgage ect.not fool proof but will tell you a little bit about them as to whether to ask for a contract or up front money.cut my losses by about 75-80% and they will never know unless you tell them.59.00 a year saved [est app 60,000.00 of write offs first year not to mention att fees

I will look into that, what is the name of the company you use?

[ksss]

I have been thinking about this a lot this past week as I wait for a homebuilder to pay for the work i did at the end of April. It's a real stress builder when you know the work was done right, they like the work, and yet... no check.

One Knucklehead builder owes me 12K. I got a check last week for about 5500. BOUNCE............Bounce.

[SiteSolutions]

One Knucklehead builder owes me 12K. I got a check last week for about 5500. BOUNCE............Bounce.

Are you serious? Pay you less than half and it still bounced. Things aren't that bad here, but I just hate having to bankroll all these larger builders. The good smaller ones pay you upon completion or at least by Friday. I should just charge 10% per week past 10 days.

[charlesp]

I will look into that, what is the name of the company you use? intillus is about the best i've found you can choose from any number of checks you wish to peform.what makes this one suitable for me is phone number is all you need cell or otherwise. you can get an idea of who or what you are dealing with before you ever meet them ect

[ksss]

intillus is about the best i've found you can choose from any number of checks you wish to peform.what makes this one suitable for me is phone number is all you need cell or otherwise. you can get an idea of who or what you are dealing with before you ever meet them ect

I really appreciate the info. I cant take another assbeating like I took last year on defaulting contractors and homeowners.

[ksss]

Are you serious? Pay you less than half and it still bounced. Things aren't that bad here, but I just hate having to bankroll all these larger builders. The good smaller ones pay you upon completion or at least by Friday. I should just charge 10% per week past 10 days.

No one pays the surcharge, at least here. If you end up in court of course, the court will allow a reasonable fee, but other than that good luck.

[charlesp]

I really appreciate the info. I cant take another assbeating like I took last year on defaulting contractors and homeowners. again the final decision is always risky until you know the customer and then somerimes you still get burnt.skiptracers ,usedcar companies ect use this data base.before the national grid was added the pd's, private investigators, banks,and even the infernal revenue agency used intellis,along with insurance investigators.i found out about it from an associate who was an ins fraud investigator.hope it helps a little.every penny is so very precous when you have to bust tail to try to survive in this day