Contractor Credit Check

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frogneck77

Senior Member
Location
Shelton,CT
Does anyone have any info on running a credit check on a GC? I was just awarded a large residential job for a GC I have never personally worked for and I want to cover all my bases. Ive yet to discuss payment terms, any info on how to approach a more favorable payment term than our typical 3rd down,3rd after rough,3rd on the finish plan would be appreciated as well.The contractor is reputable, but the slowing market makes me nervous-especially when a financial friend of mine informed me how thinly capitalized most builders are.
Thanks,
Bill
 
Dun and Bradstreet. I think it costs about $150. You can do a public records check for free, and Google everything you can, but it won't be as good.
 
Check with the BBB. Contact local building department and see if they have had complaints.

You can probably also check your state's website. Look up his business and see if he has any outstanding liability and is listed as a business debtor.
 
emahler said:
probably not that fast, else he wouldn't be using a new electrician:D
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Or maybe his old electrician wasnt good, or didnt live up to their standards in another way. I wish I knew the real scenario-Gotta get on that mind reading thing!
 
RayS said:
Dun and Bradstreet. I think it costs about $150. You can do a public records check for free, and Google everything you can, but it won't be as good.
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Just checked out their website. Looks like their offer a full credit report for @150. Not a bad deal for a little insurance/info
 
frogneck77 said:
Does anyone have any info on running a credit check on a GC? I was just awarded a large residential job for a GC I have never personally worked for and I want to cover all my bases. Ive yet to discuss payment terms, any info on how to approach a more favorable payment term than our typical 3rd down,3rd after rough,3rd on the finish plan would be appreciated as well.The contractor is reputable, but the slowing market makes me nervous-especially when a financial friend of mine informed me how thinly capitalized most builders are.
Thanks,
Bill
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IF HE IS A LICENSED GENERAL CONTRACTOR. HE CAN BE REPRIMANDED BY THE BOARD. IF HE DOES NOT PAY.
 
i would also check the courts to see if he has been sued for non payment. also dnb doesnt show everything, check smartbusinessreports.com to get experian. maybe also run a background check through lexis-nexis or choicepoint to see what dirty tidbits come up.
 
I have had major problems with a GC. Worked for him for years paid on time. Then he had two owners not pay him for a couple of sizable jobs. From then on out the GC made sure the owners had the money by letter from the bank. I argued that it was not my responsibility to qualify the customers, with which he agreed, but in the end he didn't get paid and none of the subs either. He went bankrupt.

So now I pay attention to who the owner is and where the money will come from. It may not help but at least I feel better.
 
frogneck77 said:
Does anyone have any info on running a credit check on a GC?
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Before you run a credit check did you get all the usual information?

1. Is this a local contractor?
2. How many years has he been in business? How many with the same company name?
3. Most operate as a corporation. Check state web site and see when they were incorpotated and just how many times they had changed names.
4. Do you know a street address for his place of business? Drive by an check it out.
5. Most don't do this but if this is a remodeling job then check the permit and make sure it's in the company name and not a homeowner permit.
6. Then do as ITO suggest and call a couple of the subs from past jobs.

When I look at a job I ask up front how the job is being financed and if there is enough to finish.

By the way if the guy is new in business he won't even have a D&B rating.
 
Quote" "financial friend of mine informed me how thinly capitalized most builders are."

Your friend hit the nail on the head, that is why any large jobs require a secure payment structure, best worked out with a commercial bank, there are so many ways to protect yourself, you may want to seek help on chosing the right path.

Also, it is best to have these terms in place before any contracts are signed, it is next to impossible to change terms, once you agree to a contract, on larger jobs we hire an attorney to structure everything.
 
dhamman said:
I use my major supply houses. Check with there credit department they can usually run the Dunn & Bradstreet for free
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I have heard of this practice in many other posts on this forum, Yet have never heard a mention of it from any EC's or supply houses around her- Whats the deal?
 
buckofdurham said:
IF HE IS A LICENSED GENERAL CONTRACTOR. HE CAN BE REPRIMANDED BY THE BOARD. IF HE DOES NOT PAY.
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Common Business Laws vary State to State and the rules under which any business is licensed to provide a service do as well.

How any conflict or penalty or anything else is to be resolved in respects to doing business, needs be be well understood by the parties involved before going into a contract agreement.
 
frogneck77 said:
I have heard of this practice in many other posts on this forum, Yet have never heard a mention of it from any EC's or supply houses around her- Whats the deal?
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A D&B Report is not free, someone pays. The credit agency we use, can supply anything from a credit score, all the way up to a detailed look at the entire companies background, including assets, and their payment history.
 
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