|
Understanding Factoring!
What is factoring?
Factoring is the purchase of your accounts receivable (invoices) in order to provide you with the cash flow you need. Factoring is a widely accepted financing option used by companies of all size.
How long will it take to receive funding?
Typically within 24 hours of receiving your company's information, you will receive a proposal. Once accepted, we conclude our due diligence and complete documentation. Funding can happen as early as a few days of initial contact with your company. It is common to fund within 24 hours of your invoice submission.
Do I need to sell or factor all of my invoices?
No. Depending on the amount of additional cash flow you require, you decide which invoices we factor from your company. Our services help you maintain flexibility while accommodating your cash-flow needs.
How does factoring differ from bank financing?
Factoring is faster and less complicated than bank financing. Factoring companies make decisions based primarily on the credit worthiness of your customers while a bank's credit decisions rely mainly on your company's financial history, cash-flow and collateral. Factors fund quickly, often within days of receiving an application and when banks generally take weeks or months. Additionally, when you factor your accounts receivable, your company incurs no debt. There is no interest to pay or principal to repay. Factoring can also help companies that banks traditionally shy away from, such as start-ups, companies with tax liens or ones in bankruptcy.
Who makes a good factoring client?
These are companies who sell a product or service to commercial or government entities and need cash fast to make payroll, pay suppliers or fill orders.
How can factoring help me accelerate my cash-flow?
You receive cash immediately from your invoices instead of waiting 30, 60 days or more for your customers to pay. It is as if you have COD terms with your customers. You receive our collection and credit expertise so you can enjoy increased cash-flow while attracting new business. Then you can concentrate on running and growing your core business.
What does factoring cost?
Rates are based on the amount your company factors and how long it takes your customers to pay. We are happy to provide you with a quote if you give us some basic information regarding your business.
Is factoring a type of loan?
No. Factoring is not a loan. It is the purchase of an asset, your accounts receivable. While approval of a bank loan considers all of your company's assets, as well as your financial history and balance sheet, a factor relies mainly on the credit worthiness of your customers. Factoring is often the ideal solution for businesses seeking additional or alternative methods of funding.
What type of invoices can my business factor?
You can factor almost any valid invoice generated to your credit-worthy commercial or government customer for a service rendered and completed, or a product delivered and accepted.
Does it matter if my company has a bankruptcy, bad credit, poor financials or other derogatory information?
As we base our financing decisions mainly on the credit worthiness of your customer base, generally the financial strength of your company is not going to prevent you from obtaining our factoring services.
Will my customers think my business is experiencing financial difficulty when they learn I'm using a factor?
Not at all. Factoring is a long-established and mainstream financing option for businesses. It is likely that some of your customers do business with vendors using a factoring service.
I have customers throughout the United States. Are there any restrictions?
No. We can work with any business or government agency in the United States. What matters is that your customers are credit-worthy.
What types of businesses do you factor?
We finance companies from a broad range of industries including, but not limited to, truckers, telecommunications companies, temporary-permanent personnel agencies, nursing registries, manufacturers, wholesalers, distributors, consulting companies, engineering firms and security-related services.
What size businesses qualify for funding?
Our clients are companies who invoice a minimum of $10,000 each month. We help small start-ups as well as mid-sized businesses with needs up to $1 million.
|
|
