Articles by
Dr. Anthony F. Cicone
Consumer Contract Financing for the Home Improvement Industry
by Dr. Anthony F. Cicone,
CFS 3/4/10
If you are a contractor, licensed residential builder, specialty contractor or "handyman"
involved in the home improvement or home renovation industry you know that if you can not provided financing to the sub-prime consumer, as well as the home-owner with stellar credit, you will be leaving money on the table and giving your competition a great advantage over you. By sub-prime consumer, I am referring to those home owners with credit scores under 700, and there are a great many home owners with credit scores under 700 who would be interested in your services if only they could qualify for the financing to enable them to acquire your product and/or service.
Access Funding Center, Inc. provides a consulting service relevant to consumer contract financing (consumer receivable financing). Along with your product or service you are really selling an affordable monthly payment. In order to achieve an affordable monthly payment you will need contract terms of one to two years and in some instances three or even four year terms. The problem is that for cash flow reasons you don't want to be slowly receiving small monthly payments for three or four years, or even for one or two years. Smart home improvement contractors understand that they need their cash now rather than latter. For this reason many builders would prefer to "
cash out"
or sell their consumer receivables (consumer contracts) upon the completion the job.
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The advantages of selling, or factoring, your consumer receivables (retail installment contracts, consumer notes, etc.) is to receive payment for your services now rather than latter and thus position yourself to enhance your profitability. Some of the benefits of cashing out your retail installment contracts (consumer notes) and thus enhancing your cash flow position are as follow:
| 1.Elimination of bad debt |
| 2.Take advantage of early payment and volume discounts |
| 3.No loss of equity |
| 4.You don't incur debt because you are not borrowing |
| 5.You can leverage off your customers' credit |
| 6.Detailed reports from the funding source |
| 7.You have more time to market and expand your business |
| 8.Early detection of customer service problems |
| 9.Credit screening |
| 10.Credit monitoring |
Consumer contract financing (consumer receivable financing, financing retail installment contracts, etc.) is available to, but not limited to the following types of home improvements/home renovations:
| 1 Low E windows and doors |
6 Steam Showers |
| 2 Siding and Roofing |
7 Walk-In Bath Tubs |
| 3 "High Tech"Insulation | 8 Bathroom Renovations |
| 4 Solar Panels | 9 Kitchen Renovations |
| 5 Low E Water Heaters |
10 Low Energy HVAC Systems |
For more detail contact Access Funding Center, Inc. by phone at 864-575-4133 or by e-mail at DrCicone@backroads.net.
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