Article 1 · Supports Week 2 posts

The “Check Is in the Mail” Test: 6 Red Flags a Customer Won’t Pay

Target search: signs a customer won’t pay · Links to: Place an Account · Approx. 750 words

Every business that extends credit has heard it. “The check went out last week.” “We’ll pay when the operator pays us.” “Let me talk to our controller.” One of those, on its own, is normal. A pattern of them is a warning. In the oilfield, where payment delays travel down the chain from operator to service company to subcontractor, learning to read that pattern early is the difference between a slow payment and a write-off.

Here are six red flags we see again and again, and what to do when you spot them.

1. Partial payments with no explanation

A customer who sends $5,000 against a $40,000 invoice without a call or a plan isn’t catching up. They’re managing you. Partial payments can buy a customer months of time while the account ages and your options shrink. Ask for a written payment schedule, and treat a missed installment as a missed payment.

2. A new contact who doesn’t know the account

When your usual accounts payable contact disappears and the new person “needs to look into it,” the clock resets in their favor. Turnover happens, but it is also a common stalling tactic. Send a complete statement with copies of the invoices and signed tickets, and ask for a commitment date in writing.

3. Requests to change terms in the middle of a job

A customer who suddenly asks for net 90 instead of net 30, or wants to bill against a future phase, is often signaling a cash problem. Before agreeing, look at their payment history and decide whether the work is worth the added risk. Get any change in writing, signed by someone with authority.

4. Bounced or post-dated checks

A returned check is one of the clearest signs a customer can’t pay. A post-dated check is a promise, not a payment. Either one is a reason to act now rather than wait.

5. Equipment or crews pulled from location

When a customer starts demobilizing, finishing jobs early, or moving equipment off a lease, the leverage you have today may not exist next month. This is especially important for oilfield work, where lien rights are tied to the property and to strict timelines.

6. Silence after the invoice date

No dispute, no question, no response. Silence is often the most serious red flag of all, because a customer who intends to pay usually says something. If calls and emails go unanswered for two weeks past the due date, it’s time to escalate.

When you see two or more

One red flag is worth watching. Two or more on the same account means it’s time to act, while the account is young, the customer still has assets, and any lien rights are still available. The longer an account ages, the harder it becomes to recover.

Melton Norcross & Associates has specialized in recovering past-due oil and gas receivables for more than 30 years, from Frisco, Texas and Lafayette, Louisiana. We work on contingency: if we don’t collect, you don’t pay. If an account on your books is showing these signs, place an account or call (469) 513-8458 for a free review.

LinkedIn post to share it: “When a customer goes from ’we’ll pay Friday’ to ’the check is in the mail’ to ’let me talk to our controller,’ you’re no longer being scheduled. You’re being managed. We wrote up the six red flags we see most often, and what to do about each one. [link]”

Article 2 · Supports Week 3 posts

Credit Application Must-Haves: 5 Things Every Commercial Application Should Include

Target search: commercial credit application · Links to: free Credit Application Template · Approx. 650 words

The cheapest collection tool a business will ever use is a good credit application. Signed before the first job, it sets the terms, identifies who is responsible, and makes recovery faster and cheaper if an account ever goes bad. Signed after the first missed payment, it’s almost impossible to get.

Most of the credit applications we see are missing at least one of these five things.

1. The customer’s exact legal entity name

“ABC Oilfield” is not a company. “ABC Oilfield Services, LLC” is. If the name on your paperwork doesn’t match the legal entity, you may struggle to file a lien, sue, or collect a judgment against the right party. Check the name against the state’s business records before you extend credit.

2. A personal guaranty

If the company can’t pay, a personal guaranty gives you someone else to collect from. Many owners will sign one without hesitation, and the ones who refuse are telling you something about the risk.

3. Clear payment terms

Spell out the due date, the late charge, and what happens when an account goes past due. Terms that are vague on paper become arguments later.

4. Collection costs and attorney fees

A clause making the customer responsible for collection costs and reasonable attorney fees can change the math of recovering a past-due account. Without it, those costs often come out of what you recover.

5. A signature from someone with authority

A signature from a field supervisor may not bind the company. Make sure the person signing is an owner or officer, and that their name and title are printed clearly.

Start with a template

We’ve put together a free commercial credit application template that includes all five. Download it, add your company details, and have your attorney review it for your state. Then use it on every new customer, before the first job.

This article is general information, not legal advice. Have your attorney review any credit application before use.

LinkedIn post to share it: “A complete credit application, signed before the first job, is the cheapest collection tool there is. Here are the 5 things every commercial application should include, plus our free template. [link]”

Article 3 · Supports Week 3 posts

Personal Guaranties: When They Save an Account, and What Makes One Hold Up

Target search: personal guaranty commercial credit · Links to: Personal Guaranty Template and Place an Account · Approx. 600 words

When a company can’t pay, the question becomes simple: is there anyone else responsible for this debt? A personal guaranty is often the answer. It’s a promise, signed by an owner or officer, to personally pay the company’s debt if the company doesn’t.

In oil and gas, where small service companies and contractors can close, reorganize or disappear quickly, a guaranty can be the difference between recovering an account and writing it off.

Why it matters

Limited liability companies and corporations exist to protect their owners from the company’s debts. That protection works against you when your customer stops paying. A personal guaranty steps around it, so the owner’s own assets can be reached if the business can’t or won’t pay.

What makes a guaranty hold up

• It’s signed by the right person, an owner or officer, signing as an individual, not just on behalf of the company.
• It’s clear what it covers: all present and future amounts owed, including late charges and collection costs.
• It’s in writing and kept on file with the credit application, so it’s easy to find when you need it.
• It identifies the guarantor fully: printed name, address and signature date.

When to ask for one

The best time is before you extend credit, as part of the credit application. Asking for a guaranty after a customer falls behind rarely works. If a new customer refuses to sign one, consider tighter terms, a deposit, or a smaller credit limit.

If an account goes bad

A signed guaranty gives a collection agency and, if needed, a collection attorney another path to recovery. When you place an account with Melton Norcross, send the guaranty along with the invoices and the credit application, and we’ll include the guarantor in our investigation from day one.

This article is general information, not legal advice. Have your attorney review your guaranty language.

LinkedIn post to share it: “When a company can’t pay, a personal guaranty decides whether there’s anyone left to collect from. Here’s how to use one, and what makes one hold up. [link]”

Article 4 · Supports Week 1 and Week 3 posts

Mineral Liens Have Deadlines: What Oilfield Service Companies Need to Know

Target search: oilfield lien deadline, Texas mineral lien, Louisiana oil well lien · Links to: Mineral Liens page · Approx. 650 words · Legal review required before publishing

If you provided labor, equipment, materials or services on an oil or gas well and haven’t been paid, you may have one of the strongest collection tools available in Texas and Louisiana: a lien. But lien rights don’t last. Miss the filing window, and that leverage is gone for good.

What a mineral lien does

A mineral lien (called an oil well lien in Louisiana) attaches your unpaid claim to the well, the lease and, in some cases, the production. Instead of chasing only the company that hired you, your claim is tied to the property you improved. That often brings operators and owners to the table quickly, because a recorded lien affects their asset.

Who can file

In both states, the protection generally reaches the businesses that do the work in the field: drilling contractors, service companies, equipment rental firms, trucking and hauling companies, and suppliers of materials, among others. Whether a specific job qualifies depends on the work and the contract chain.

Texas and Louisiana are different

Both states protect oilfield service providers, but their rules differ, including what must be filed, where, who must be notified, and how long you have. Louisiana’s oil well lien law also has its own notice requirements. A company working on both sides of the state line can’t assume one set of rules covers both.

The deadline is the whole game

Lien filing windows are measured in months, not years, and the clock generally starts from the last day work was performed. Every week an invoice sits unpaid is a week off that clock. By the time many companies decide to escalate, the window has already closed.

What to do now

• Keep accurate records of the last day you worked on each well or lease.
• Flag any oilfield invoice that is 30 days past due for lien review.
• Don’t wait on a promise of payment if the filing window is getting close.
• Talk to a professional before the deadline, not after.

Melton Norcross tracks lien timing on every oilfield account we accept, in both Texas and Louisiana. If you’re waiting on payment for field work, don’t wait on the lien. Check your deadline with our team at (469) 513-8458.

This article is general information, not legal advice.

LinkedIn post to share it: “In Texas and Louisiana, mineral liens are one of the strongest tools for getting paid on oil and gas work, but only if they’re filed in time. Here’s what every oilfield service company should know before the window closes. [link]”