NEWS
11/2/2009 1:00:00 PM
Minnesota UCC Update Sept. 2009
The Minnesota Secretary of State is in the process of developing a new on-line application for filing Uniform Commercial Code(UCC) documents that is expected to be ready in 2010. They are currently operating under the new online application. It is their intention to discontinue the acceptance of filings against all pre-existing liens originally recorded with Minnesota counties that have not properly transitioned to the central system via 'in-lieu of filing' under the provisions of UCC Revised Article 9, MN Statutes Chapter 336, Article 9, Part 7.
10/19/2009 1:55:00 PM
Oklahoma County Clerk's Office UCC Update
Effective October 19, 2009, the Oklahoma County Clerk's Office is implementing new computer applications for the Register of Deed (ROD) and Uniform Commercial Code (UCC) filing offices. The new technology will offer the ability to file electronically along with new search features. Oklahoma's County Clerk Carolynn Caudill's goal "is to provide you with the most user-friendly, up-to-date technology that makes your job filing documents and searching county records much easier."
10/16/2009 3:35:00 PM
Important Changes in Pennsylvania Lien Laws
Pennsylvania Senate Bill 563 became effective October 10, 2009.
The new law provides that a waiver of lien rights may be filed, preventing liens from attaching to residential property. Previously, no-lien agreements were available only on residential projects with general contracts under $1 million. Now, a waiver of lien rights may be filed on any residential project, regardless of the contract value.
9/16/2009 3:24:00 PM
Connecticut Secretary of State Offers Online Filing
Effective September 2009 the Connecticut Secretary of State now offers online filing for ONLY original UCC Financing Statements. Along with this enhancement comes the doubling of filing fees. NCS UCC Services Group has partnered with the Connecticut Secretary of State as an online service provider.
9/16/2009 3:12:00 PM
Puerto Rico UCC Update
The Commonwealth of Puerto Rico Department of State is undergoing financial difficulties that have resulted in the reduction of their workforce. During this restructuring the filing of UCC documents has been delayed. There have been no UCC documents recorded since July 2009. The office continues to accept mailed documents by date stamped in order of receipt.
9/15/2009 3:21:00 PM
Georgia UCC Update 09/15/09
Effective September 15, 2009, The Georgia Cooperative Authority has begun transitioning to online filing. Currently this new service is only offered through three counties – Fayette, Barrow and Coweta with NCS UCC Services Group as a pilot partner.
Under the current system, a secured party need only file in one county to receive statewide notification of his lien position. This continues to be true for original UCC filings, but any UCC Amendment filings must be recorded in the county where the original filing was made. Historically, prior to 1995, it was necessary to file in all 159 Georgia counties to receive statewide notification. The central index provides secured parties with greater protection while saving them both time and money.
8/12/2009 2:53:50 PM
Shortened Hours at Recorders' Offices
Budget cuts have affected recorders' offices, and many offices have shortened their work weeks. If the recorder's office is closed when a document is sent for recording, it is unclear whether courts would roll the deadline back a day or to the following business day. Please allow sufficient time for recordation of your documents.
8/10/2009 2:30:00 PM
Efficient. Paperless. Secure.
Your documents will now be stored electronically in a secure central location, easily accessible 24/7 from anywhere, allowing you to work more efficiently.
» Virtual File Cabinet: You can easily access all completed documents with just a few clicks of your mouse.
» Efficient and Organized: Everyone with access to a contact’s portal can view the documents.
» Paperless Archiving: Documents do not need to be printed to maintain a copy.
» Easy Email Retrieval: The subject line of the notification email will now include your reference number and debtor name.
» Simple: The text of the email will describe the next action and time frame, along with any pertinent notes.
» Comprehensive Storage and Archiving: Other legal documentation (notices of commencement, payment bonds, etc.) and any written communication received in response to a provided service will be included in your document pool.
» Environmentally Friendly: Paperless records mean less waste while conserving resources.
8/3/2009 11:09:00 AM
Credit Research Foundation Releases Second Quarter Receivable Report
The Credit Research Foundation released its Report on Domestic Trade Receivables for the Second Quarter of 2009 and it shows shifts in the condition of its members’ accounts receivables portfolios. The following figures summarize the report:
The Collection Effectiveness Index rose by approximately 3.62 percent when compared to the first quarter.
When the second quarter of 2009 is compared with the same quarter in 2008, it rose by about 3.23 percent. While not a large increase it does show an improvement.
DSO when compared to the first quarter was up slightly, but this was probably because of the influence of sales on DSO. (DSO is influenced by rising or falling sales. Rising sales leads to a declining DSO while falling sales, the current environment we find ourselves in, leads to a rising DSO. This is a statistical or mathematical effect on the figures and needs to be kept in mind when analyzing DSO trends.)
The Average Days Delinquent declined; the Percent Current on CRF Members’ Aged Trial Balances improved; and the Percent Over 91 Days Past Due declined significantly from the first quarter—about 29.3 percent. However, Percent Over 91 Days Past Due, remained above the level reported for the second quarter of 2008.
This improvement in the Accounts Receivable Portfolios of CRF members may mean that in the third quarter of 2009 we will see a slowing in account placement with CCAA Members.
The complete report may be purchased from Credit Research Foundation by visiting their website, www.crfonline.org.7/20/2009 10:01:00 AM
New Record Set: Business to Business Accounts Placed for Collection Continue to Rise
For the 12 months ending June 2009, members of the Commercial Collection Agency Association of the Commercial Law League of America (CCAA) received a record volume of commercial or business-to-business accoounts placed for collection. Almost $17 billion in accounts were received. This represents an increase of about 39.5 percent over the 12 months ending June 2008.
In the second quarter of 2009, approximately $4.6 billion in account placement was received by CCAA members. This represented a 39.5 percent increase over the second quarter of 2008.
"The second quarter 2009 figures represent a strong increase in business-to-business account placement and an acceleration of the trend started in the fourth quarter of 2008," said Emil Hartleb, CCAA executive director. "We believe the increased account placement is reflective of the tight availability of credit and and a slowdown in sales, which has caused a cashflow crunch for small and medium size business. Most economists beleive this situation will prevail into the fourth quarter of this year before improvement is noted."
While the collectability of the accounts placed for collection has declined, CCAA members reported that profit margins have only been modestly impacted. It is not expected that account placement will continue to rise to the levels experienced in the first and second quarters of 2009. However, in a recent survey CCAA members believe that third and fourth quarter 2009 account placement will continue to be strong.
"These times continue to be problematic for American business as bankruptcies rise and a greater number of customer accounts on companies' aged trial balances move to the 60 and 90 day columns, representing an increase in day sales outstanding (DSO) and a decrease in cash flow," said Hartleb. "Companies have become more selective in their credit decisions and are watching and reacting faster to slower paying customers and placing them for collection with CCAA members faster."
7/7/2009 3:48:51 PM
White Paper: Paving the Way for Economic Recovery
Part of President Obama’s American Recovery and Reinvestment Act pledges to improve infrastructure and modernize public buildings throughout the country. In addition, Congress has approved billions of dollars in work through normal highway funding. Even with the promise of all this new construction, it is critical you know how to protect your receivables when contributing materials or supplies to a federal construction project. This white paper discusses in detail how the Miller Act can protect you during this time of economic recovery. Download it here.
6/24/2009 11:15:46 AM
November Construction Slides 3 Percent
November construction starts fell 3 percent from the previous month to $454.5 billion (annual rate), the weakest level so far in 2008. Read the full article from the December 2008 issue of Market Dynamics, published by McGraw-Hill Construction.
6/24/2009 11:09:36 AM
Generation Renovation
Many of our customers are dealing with the realities of the economic recession: lower sales, reduced operating budgets, increased customer defaults, bankruptcies and layoffs. During these harsh times, NCS continues to stand as a steady partner with our clients' credit departments, ready to provide them with expert guidance and support to secure their tomorrow.
One way NCS is doing this is through Generation Renovation: A newly constructed notice to owner program featuring three generations of options—Attorney Notice, Premium Notice and Express Notice—based on your level of need. This program will officially roll out in July 2009. For more information on our upcoming new notice program, contact us at SecureYourTomorrow@ncscredit.com or 800-826-5256.
6/22/2009 3:51:02 PM
White Paper: Proactive Solutions in a Tough Economy
Now, more than ever, it is important to secure your competitive position in the marketplace. This article, written by NCS President Mary Cowan, discusses how today’s economic uncertainty can actually spur credit professionals to make vital improvements in credit processes. We offer solutions and ideas to help you make those improvements and secure your tomorrow. Download the white paper here.
4/22/2009 11:13:00 AM
Business to Business Accounts Placed for Collection Continue to Rise and Set a Record
For the twelve months ending March 2009, members of the Commercial Collection Agency Association of the Commercial Law League of America, (CCAA) received a record volume of commercial or business-to-business accounts placed for collection. Over $15.4 billion in accounts were received. This represents a percentage increase of 27.2 percent over the twelve months ending March 2008.
In the first quarter of 2009, approximately $4.2 billion in account placement was received. This represented 34.6 percent increase over the first quarter of 2008.
"These times continue to be problematic for American business as bankruptcies rise and a greater number of customer accounts on companies' aged trial balances move to the sixty and ninety day columns representing an increase in Day Sales Outstanding (DSO) and a decrease in cash flow," said Emil Hartleb, CCAA executive director. "Companies are becoming more selective in their credit decisions and watching and reacting faster to slow paying customers."
3/31/2009 11:02:00 AM
Changes to Georgia Lien Waiver Requirements
Be aware! Even though the waiver you sign for Georgia projects may appear to be conditional, your rights to proceed with a lien or bond claim will be jeopardized if payment is not received and an affidavit of nonpayment is not recorded timely.
Effective March 31, 2009, when a claimant is requested to execute a waiver and release in exchange for or in order to induce payment, the waiver must follow the new, statutory form. Download the new forms here: FORM ONE and FORM TWO
Although the waiver appears to be conditioned upon the receipt of funds, when the waiver so specifies an affidavit of nonpayment or a Mechanic's Lien must be recorded within 60 days from the date of the waiver in order to retain your right to file a lien or to make a claim against a payment bond. (A mechanic's lien may be recorded in place of the notice of nonpayment within 90 days from last furnishing, but within 60 days from the date of the waiver.)
The following wording must appear on the waiver:
NOTICE: When you execute and submit this document, you shall be conclusively deemed to have been paid in full the amount stated above, even if you have not actually received such payment, 60 days after the date stated above unless you file either an affidavit of nonpayment or a claim of lien prior to the expiration of such 60-day period. The failure to include this notice language on the face of the form shall render the form unenforceable and invalid as a waiver and release under O.C.G.A. Section 44-14-366.
When NCS is tracking a Georgia project for you, please advise the date a lien waiver was signed so that we can recalculate your deadline to either file the affidavit of nonpayment or the lien.
Note: The prior statute required the lien or affidavit of nonpayment to be filed within 30 days from the waiver; however, the "NOTICE" verbiage was not required to appear within the waiver form.
For more information, please contact NCS at 800-826-5256 or SecureYourTomorrow@ncscredit.com.
Click here to download a PDF of this information. 2/23/2009 11:14:00 AM
Defining a Discharge in Bankruptcy
The Administrative Office of the U.S. Courts defines a discharge in bankruptcy in the following manner:
"A bankruptcy discharge releases the debtor from personal liability for certain specified types of debts. In other words, the debtor is no longer legally required to pay any debts that are discharged. The discharge is a permanent order prohibiting the creditors of the debtor from taking any form of collection action on discharged debts, including legal action and communications with the debtor, such as telephone calls, letters, and personal contacts. Although a debtor is not personally liable for discharged debts, a valid lien (i.e., a charge upon specific property to secure payment of a debt) that has not been avoided (i.e., made unenforceable) in the bankruptcy case will remain after the bankruptcy case. Therefore, a secured creditor may enforce the lien to recover the property secured by the lien. "(Bankruptcy Week, Vol. 9, No. 8, February 23, 2009.)
12/17/2008 1:08:00 PM
Accounts Receivable: The Bank of Last Resort
Credit Today conducted a roundtable discussion where trade credit leaders met to discuss the current credit crisis. The group made some stark predictions about the economy, and the key findings are now available.
Click here to read the full release.
11/12/2008 1:05:00 PM
Surviving the Credit Crisis - Managing Receivables
The latest white paper from The Credit Research Foundation, Managing Receivables in the Midst of Today's Economic Environment, focuses on the potential impact it will have on your business.
After reading this white paper we encourage you to contact NCS to review your current credit procedures to make sure you are in the best position to get paid. For 38 years NCS has been the expert in providing solutions to Secure Your Tomorrow.
Click here to read the white paper.
This article is being reproduced with permission from The Credit Research Foundation.
10/10/2008 12:59:00 PM
Surviving the Credit Crisis
After reading this white paper, Lessons for Businesses to Learn from Today's Credit Crisis, we encourage you to contact NCS to review your current credit procedures to make sure you are in the best position to get paid. For 38 years NCS has been the expert in providing solutions to Secure Your Tomorrow.
Click here to read the white paper.
This article is being reproduced with permission from the Credit Research Foundation.
9/25/2008 12:56:00 PM
Slow Deliveries with DHL in Wyoming
DHL customers are finding a slow deliver time for packages delivered via DHL in Wyoming and Montana. DHL Express closed all seven offices in Montana and two in Wyoming this summer. Please be aware of this if shipping close to a Preliminary Notice or Lien deadline.
9/9/2008 12:54:00 PM
Ohio UCC Update Effective 9/1/08
On September 1, 2008, House Bill 46 went into effect, giving the Secretary of State the authority to reject any document containing a Social Security number or federal tax identification number.
It is requested to remove all personal information from documents prior to filing them. Visit the Ohio House of Representatives' website at http://www.sos.ky.gov/business/ucc for a complete copy of House Bill 46.
8/15/2008 12:51:00 PM
East Baton Rouge UCC Procedure Change
Recording Procedures Change for East Baton Rouge, LA
As of July 14, 2008, each document mailed to East Baton Rouge Parish Clerk of Court must include a completed copy of the "Recording Instruction Sheet." This change is in conjuction with the live activation of the new digital imaging system. All information on the Recording Instruction Sheet must be completed. Pay special attention to the Recording Instructions header where you must check the category of records into which you wish your document recorded. Images are viewable through the subscription based "Online Access Services."
Visit the East Baton Rouge Clerk of Court website at http://www.sos.ky.gov/business/ucc for more information. If you have any questions, contact NCS at (800) 826-5256 or SecureYourTomorrow@ncscredit.com.
8/15/2008 12:49:00 PM
Nebraska UCC Law Revised
Nebraska UCC Law Amendment will now go into effect September 2009, not July 2008.
Approved by Governor Heineman on March 19, 2008, law LB 851 revises UCC 9-506(b). Now to go in effect September 2009, the law amends that if a debtor is an individual correctly stating only the last name on the original financing statement is sufficient. First and middle names are now meaningless. This now puts a huge burden on UCC searchers. Searchers will have to review every financing statement that provides the same last name. "The intent of the law is to provide secured parties with greater certainty that errors or omissions on an individual's debtor's first or middle name (initial) would not make the financing statement seriously misleading."
For more information visit Nebraska's legislative site at http://www.unicam.state.ne.us.
7/30/2008 12:45:00 PM
Kentucky UCC Acknowledgement Procedure to Change
Effective August 1, 2008, Kentucky changes UCC acknowledgement procedure.
To help reduce costs, the Kentucky Secretary of State Office is modifying the UCC acknowledgement process. Currently, customers who complete Box B on the UCC Financing Statement receive a mailed copy of the original UCC filing. Since a redacted version of all filings is available online at http://www.sos.ky.gov/business/ucc/online, customers now completing Box B will be mailed a postcard acknowledgement as receipt of the filing. Customers are encouraged to view the filing online. Beginning August 1, original documents will no longer be returned.
The acknowledgement postcard will include:
• A visual copy of the first page of the record image (redacted for security)
• The web address where the filing can be viewed online
• The file date and time; original file date and time and filing status
For more information click here. If you have any questions, please contact NCS at (800) 826-5256 or SecureYourTomorrow@ncscredit.com.
7/16/2008 12:42:00 PM
Attention! Utah Changes Hours of Operation
Please be advised that beginning Monday, August 4, 2008, the Working 4 Utah initiative will be implemented. This program will extend state government service hours from 7 a.m. to 6 p.m., Monday through Thursday, with offices closed on Fridays. Governor Jon Huntsman states the goal is to "conserve energy, save money, improve our air quality, and enhance customer service."
New hours of operation as of Monday, August 4, 2008:
Monday - Thursday, 7 a.m. to 6 p.m.
Closed on Fridays
UCC filings and searches may be submitted online at any time 24/7/365.
For more information click here. If you have any questions about this information, please contact NCS at (800) 826-5256 or SecureYourTomorrow@ncscredit.com.
7/1/2008 12:32:00 PM
Security for a Softening Economy
It happens everyday. Credit Managers face the difficult decisions of extending credit lines, reviewing financial risk, and protecting their accounts receivable. To make these decisions even more difficult add to the mix the reports of an uncertain economy.
In April 2008 a survey of The Federal Reserve's Senior Loan Officers showed that banks are preparing to weather the storm. The survey showed 55 percent of banks had tightened lending standards on corporate loans in the last three months, up from 30 percent in January. At best, our economy is softening. Like it or not, this means your customers will be looking to you for discounts or extended terms. What do you do? The answer is to do the same things the banks do. Secure collateral against the credit lines that you extend. Banks have always taken advantage of this principle. Why shouldn't you do the same?
Trade creditors have different options for securing collateral against credit lines. If the goods are being permanently affixed to a building, take advantage of the mechanic's lien laws. If not, record a UCC Filing to secure your inventory, equipment or accounts receivable.
When selling materials, providing labor or services that permanently improve real estate, the mechanic's lien filing process is the best method to get the needed leverage to ensure payment. The theory is very simple. You have improved the property; therefore the owner should not retain the improved benefit until it is paid. Legally, you can secure yourself against the piece of property to the extent you have improved that property. One issue that frequently arises is that you are asked to extend credit lines to customers that do not have the financial strength to merit that credit. The lien process gives you an option to sell on open terms.
Not everyone is eligible to file mechani's liens. It is a very defined right. Your materials must be permanently affixed to a piece of property, or your service, or labor must contribute to the improvement of that property. If your business falls within the realm of having lien rights, you must be sure to follow the required lien laws in the state where the property is being improved. In many states this means you must react early in the process. The lien laws in many states involve steps that must be taken shortly after first furnishing materials, service, or labor to the jobsite. If you do not fulfill these requirements in the times frames outlined, you may be jeopardizing your ability to take collateral against the piece of property you have improved.
UCC filings bring another opportunity for trade creditors to take security against the credit lines they extend. The good news is that UCC filings are not a defined right; businesses can take obtain security by filing a UCC Financing Statement. Taking a security interest is consensual. Your customer must grant you the right to take security in their collateral by signing a security agreement. Unlike attaching to real property under the Mechanic Lien Laws, Article 9 of the Uniform Commercial Code allows taking security in your customer's assets, which can be inventory, equipment, proceeds, accounts receivable, general intangibles, or other collateral classifications. Properly filing the UCC document makes you a secured creditor and can place you at the top of the claims pyramid.
Unfortunately there is not a crystal ball to guide you through the maze of credit decisions. However, using the tools that are available can be a great start. Do not leave yourself unprotected by not taking the proper steps. The effect of leav
5/9/2008 12:31:00 PM
Washington State - UCC Filing Fees to Increase
Please be advised that effective June 12, 2008, Fees for Washington State's UCC services will increase.
For more information visit the Washington Secretary of State's website at http://www.secstate.wa.gov/.
5/7/2008 12:28:00 PM
Tennessee Law Amendment Now in Effect
On March 5 Senate Bill 3732 amended Tennessee UCC 9-503(a). The new law took effect May 1, 2008. The bill provides that an individual name is sufficient for the UCC Financing Statement if the name is shown on one of these six documents: driver's license, state ID card, birth certificate, passport, social security card and military ID card. Again, a huge burden has been put on the searching process. It is vital that the names provided on every one of these government-issued documents be searched to reduce risk of missing an effective record.
5/1/2008 12:19:00 PM
Strategic Ways to Incorporate Security Agreements
Taking a secured interest in your customers' collateral brings numerous benefits. Learn what considerations should be made to approach customers for them to extend these benefits to you.
When you are presenting Security Agreements to your customer, there are some issues that must be taken into consideration. Are you asking for security from a new customer or an existing one? They are two very different situations and must be addressed accordingly. If it is a new customer, how have you arrived at the decision to request security? Is it because the credit line exceeds an established threshold? Does your bank place a greater value on secured accounts versus unsecured accounts? Both are good reasons to request security with which your customer would have a difficult time arguing. If it's an existing customer, are they past due or over their credit line? With existing customers requesting security is a little more difficult. You really need to think about how you can make it palatable for the customer to sign the security agreement. Can you trade an increase in their credit line for security? Do you use security as a tool to drive the debtor back to within terms?
Some of the other reasons creditors would request a security agreement:
• The debtor has requested a particularly large order which is out of their norm
• The debtor has a declining financial situation
• Liens have been filed on the debtor
• Judgements have been awarded against the debtor
• The debtor has had a change of ownership or structure
• The industry has had a downturn in business
• The creditor wishes to sell more and drive market share using a larger credit line, which requires security
• The debtor needs a favor
Some important points to understand when presenting security agreements to your customer:
• The security interest will cost your customer nothing
• Your secured interest will rank behind the debtors bank, so you won’t impact their borrowing ability
• The security interest only will become an issue if your customer defaults. If they pay their bills it will be irrelevant.
Perhaps a way to present this would be to offer two options:
• Standard terms or extended terms. That way the customer can choose which way they want the account to be handled. Or, call it your Extended Terms Program, which they qualify for. Perhaps it includes a price freeze for a 12-month period. All they need to do is sign the Program Agreement (which contains the security verbiage.)
It's interesting to see how the culture affects the behavior.When you purchase a car, you fully expect the parade of paperwork that you are required to sign, which includes a secured interest in the car. In the business world it's a little different. The way that the security agreement is presented will influence how the customer views it. Presenting the security agreement in a manner that it's just a generally accepted business practice will result in more agreements being signed than presenting it in an apologetic manner that insinuates you feel you are infringing on their business culture.
Taking a secured interest in your customer's collateral brings numerous benefits. Consideration has to be given to how to approach customers for them to extend these benefits to you. The answer is always "no" if we don't ask the question.
4/18/2008 11:07:00 AM
Nebraska UCC Law Revised
Nebraska UCC Law Amendment goes into effect July, 2008
Approved by Governor Heineman on March 19, 2008, law LB 851 revises UCC 9-506(b). Effective July, 2008, the law amends that if a debtor is an individual correctly stating only the last name on the original financing statement is sufficient. First and middle names are now meaningless. This now puts a huge burden on UCC searchers. Searchers will have to review every financing statement that provides the same last name. "The intent of the law is to provide secured parties with greater certainty that errors or omissions on an individual's debtor's first or middle name (initial) would not make the financing statement seriously misleading."
For more information visit Nebraska's legislative site at http://www.unicam.state.ne.us.4/1/2008 10:14:00 AM
Collection Tip for April
FLEXIBLE:
Be ready to adjust to the situation. Think about the kind of customer you're dealing with and adapt to meet the circumstances. Be prepared to accept a reasonable payment schedule, and a willingness to deal with a customer's circumstances.
Call NCS Collection Services Group at 800-826-5256 for more information on how to help work with your customer's situations.
3/24/2008 11:00:00 AM
Georgia Lien Law Update
GEORGIA TO CHANGE LIEN LAW EFFECTIVE 3/31/09
On February 20, 2008, the Georgia Senate passed Senate Bill 374, which will become effective March 31, 2009. Highlights of the changes to the statute include :
* A change to the time frame in which to file a lien
* A change to the time frame in which to file suit to enforce a lien
* A change to the verbiage of the lien
* Changes in the wording of lien waivers
Please refer to The National Lien Digest in your web portal for details on the upcoming changes.
3/2/2008 10:06:00 AM
How to Choose a Collection Agency
Before you place an account with a collection agency be P.R.U.D.E.N.T.
PREPARE:
Review the paperwork on the debtor before making your collections calls. Know the history of the account, credit record, the promises kept/broken. Have all records in front of you, ready for reference.
REASONABLE:
Be reasonable and ready to adjust to the situation. Think about the kind of customer you're dealing with and adapt to meet the circumstances. Be prepared to accept a reasonable payment schedule, and a willingness to deal with a customer's circumstances.
UNFLAPPABLE:
Adopt a straightforward, professional business-like attitude. You have a contract, you delivered the goods, money is owed, and you have a right to expect payment. Never let it become personal. Don't yell or raise your voice; and NEVER swear. Don't threaten: legal action is your recourse.
DILIGENT:
Make sure you're talking to the right person. Don't let the individual brush you off with "You'll have to talk to the bookkeeper." Identify the person who will pay the bill. If you can't get through after several calls, tell the secretary that you know your calls are being screened. Indicate the purpose of your call and if necessary give deadlines.
EXECUTE:
Never leave a contact open ended, such as "We'll talk next week," or "I'll send what I can." Every contact should result in a commitment to payment, of a specific amount, by a specific date, even the check number the customer is using to pay the pledge.
NOTES:
Keep detailed, accurate notes of every contact with the customer. Probe for further information on the customer. Notes of these contacts will help you in subsequent phone calls, and may be invaluable in litigation. Good notes will also help in further credit decisions, or in cases where skip tracing may be needed.
TIME:
The longer an account is held, the less likely it is that it will be recovered. If payment or a payout is not arranged within 90 days, place the claim with a collection agency. Use only an agency that is a member of the Commercial Collection Agency Section of the Commercial Law League of America. This will ensure that you're dealing with ethical professionals who are fully bonded to guarantee your remittance.
Choose NCS!
Get prompt results with over 35 years experience in successful collections. NCS joins your Credit Department team to work to affect full payment ASAP. Our collectors contact debtors during legally mandated hours nationwide and will only take legal action once all in-house resources are exhausted. Throughout the entire process, we keep you informed of your account status with the reporting method of your choice.
NCS holds the Certificate of Compliance from the Commercial Collection Agency Section of the Commercial Law League of America
By design, NCS' recovery system is one of the most ethical, economical and fastest routes available. We invite you to compare.
3/2/2008 10:04:00 AM
Obtaining Payment Bonds
NCS strongly recommends obtaining a copy of a payment bond at the beginning of a project. At the beginning of the project asking for this document is just a general request or requirement to complete your paperwork for the project. If it is not requested until after there is a payment issue, general contractors are hesitant to provide this information. The attorney will try to obtain this information from the public entity as it is considered public record but this can take time and does not always guaranty we receive a copy.
This is even more important for private projects that are bonded. For a private project, bonding information is not considered public record and general contractors are not required to provide the information.
2/1/2008 10:02:00 AM
North Carolina Retainage Reform Act
North Carolina Session Law 2007-365, Senate Bill 1245
Retainage.... the percentage of a contract price retained from a contractor as assurance that subcontractors will be paid and that the job will be completed. Often held on public construction contracts, retainage can be detrimental to smaller businesses as it ties up their cash flow. North Carolina has passed an act amending the laws relating to retainage payments on public construction projects.
The act applies to any contracts entered into on or after January 1, 2008. The act provides that no retainage be allowed on public construction contracts in which the total project costs are less than $100,000. On projects with costs of $100,000 or more, retainage is limited to 5 percent of any periodic payment due a prime contractor, and once the project is 50 percent complete, no further retainage should be withheld.
Click here to view the entire act. 2/1/2008 10:00:00 AM
Important UCC Law Change
Texas continues its tradition of pioneering changes to the UCC law.
9.503 NAME OF DEBTOR AND SECURED PARTY. (a) A financing statement sufficiently provides the name of the debtor: (1) if the debtor is a registered organization, only if the financing statement provides the name of the debtor indicated on the debtor's formation documents that are filed of public record in the debtor's jurisdiction of organization to create the registered organization and that show the debtor to have been organized, including any amendments to those documents for the express purpose of amending the debtor's name.
This means that the debtor's legal name, if a registered entity, must be obtained from the formation documents (Articles of Incorporation), not the state's public record (Corporate Certificate).
Texas has always been the pioneer for changes to the UCC law. We anticipate that the other states will enact similar laws in the future. In anticipation of this, we are advising our clients to always request the Articles of Incorporation (and debtor name amendments) to verify the name of a registered organization, instead of only doing the Corporate Certificate.
1/16/2008 9:52:00 AM
Protecting Your Receivables on Construction Projects
Construction credit carries an inordinate amount of risk. Fortunately, creditors can protect their exposure through the filing of preliminary notices, liens and bond claims. Obtaining answers to these six fundamental questions will ease the process.
Who are the parties involved on the construction
project?
As part of your sales procedure, require that your salesperson obtain complete project information. A standard job information sheet should include the project address, the names, and addresses of all parties within the contractual chain, including the owner of the project, and surety and
lender information where applicable.
What remedy is available to you?
Know whether the project is privately, publicly, or federally owned, so that you know whether your action, if you remain unpaid, would take the form of a mechanic's lien, a bond claim, or a Miller Act bond claim.
When is your deadline for protecting your lien or bond claim rights?
The requirements vary greatly from state to state, and some states even require that preliminary notices be served before materials or services are provided. Know these deadlines before you have a problem so that you can avoid missing any statutorily required actions.
How do you protect your rights?
Know the states where preliminary notices must be served. Know whether the statute requires specific language or specific information within the notice. Know whether the lien will offer more protection if filed earlier rather than later (unpaid balance lien states).
Where must the notice be served?
Some states require that notices be served upon the owner of the project, some must be served upon the prime contractor. Liens must sometimes be served upon the owner; Bond Claims on the owner, or the prime contractor, or the surety; sometimes on all three. Know the requirements of each state.
These tools have been put in place to protect the owners of construction projects and to ensure that all contractors, subcontractors and material providers receive payment for the services and materials provided. Use these tools to your advantage.
1/16/2008 9:40:00 AM
Happy New Year!
NCS wishes you and your company a Happy and Profitable New Year!
Shorten your DSO and make 2008 your best year yet. NCS publishes The National Lien Digest, a handy reference guide to current information on statutory deadlines for notices, liens, bond claims and suits. The Digest simplifies the confusing world of filing notices, mechanic's liens and bond claims by providing time and information requirements, job information sheets, threshold requirements for Payment Bonds and an 800 Hotline for any questions. Call 1-800-826-5256 for more information.
12/6/2007 9:39:00 AM
LienTracker™ Update
As a subscriber, look for your new CD coming in the mail. Kentucky, Missouri, Tennessee, Utah and Washington have all been updated. Plus a new fresh look! Contact us if you have not received your new CD.
12/5/2007 9:37:00 AM
Happy Holidays!
For those of you that are preparing to close your fiscal year, this would be an ideal time to submit any accounts that you will write off to bad debt. Even if you are not finalizing your year end financials, do not let this opportunity slip by. Let NCS' highly trained staff assist in recovery of this debt for you and start the new year off right.
Placing your collections is easy with NCS. Call 800-826-5256 to submit your placement or if you have any questions. We wish you a Happy Holiday season and hope to work with you in 2008!
3/19/2007 9:34:00 AM
How to Secure Your Accounts Receivable and Keep Your Customers
It happens every day. Credit managers face a conundrum: how to protect your accounts receivable without alienating your customers. Whether dealing with commercial sales or protracted construction projects, the laws are specific about the steps required to ensure payment...but credit managers often fear sending the wrong message to their customers by taking those very steps. After all, won't a general contractor interpret a notice sent to the owner as an insinuation of a possible lack of pay? Won't a customer interpret the filing of a UCC as a comment upon their creditworthiness?
The simple answer is this: They shouldn't. The real world answer is this: They might, if you don't manage the process carefully -- and that reaction may be amplified by established customers.
All construction project contracting should begin with a notice to owner. The purpose of a notice is two-fold. First, it is statutorily required in most states, as the first step in securing your lien rights. Second, it is a way to enlist the owner's help to ensure your payment. In effect, you're announcing that you're here, you're in the process, and you expect to get paid. The fear is that your customer will take it personally. While you should be careful in wording a notice -- in most states the verbiage required is very particular -- you can still include language that softens the impact of a notice without invalidating your future rights. It's a good idea for your notice to include language such as “No lien has been filed against the property. This is merely a notice of lien rights. This notice should not reflect upon the creditworthiness of any party, nor does it indicate any expected problems in the payment of any invoices."
In a commercial sales environment, to one degree or another, you are always at risk of your customer defaulting. Should that happen before you are paid for the goods or services you provided, you will be placed into a pyramid of payees in which the secured creditors at the top of the pyramid get paid first. How do you secure your position near the top of that pyramid?
The Uniform Commercial Code allows you to notify other creditors about a debtor's assets used as collateral, by filing a public notice. Filing the proper UCC documents makes you a secured creditor, and places you near the top of the claims pyramid. Filing a UCC puts you in the best possible position to get paid.
A UCC filing does not imply anything about your customer's ability or inclination to pay. Rather, it is an inexpensive, simple and effective way to protect your accounts receivable in the event of a customer default. In other words, it will not affect your customer in any way, and therefore will not be viewed negatively.
Choose the method of softening that you wish, but don't let the fear of customer reaction cause you to leave yourself unprotected by not taking the proper steps. The effect of leaving your accounts receivable unprotected can be disastrous. The effect of securing your accounts receivable is peace of mind.
1/12/2007 9:30:00 AM
Court Opinion on Mechanic's Liens for Public "Purposed" Property
While the court addressed the exemption from the mechanic's lien statute, it did not provide for any other remedy, such as a requirement that the prime contractor obtain a payment bond, as they would be required to do on a publicly owned project.
As always, we stand ready to assist you. For any questions about this service or the information in this notification, please call us at (800) 770-8221 or e-mail us at liens@ncscredit.com.
