Factoring: Funding Without the Debt
Small businesses sometimes deal with cash flow challenges caused by untimely customers, seasonal sales patterns, or unexpected growth spurts. Unfortunately, even a short-term slump can have devastating consequences for a business that takes on new debt to close the cash flow gap. Skip the debt. Maximize your working capital and position yourself for future success with Factor Finders’ debt factoring programs!
About Debt Factoring
Debt factoring, also known as accounts receivable factoring, is an alternative financing relationship in which you sell your open invoices to a factoring company for an immediate advance. The factoring company will send you as much as 90 percent of your open invoice amount within 24 hours of invoice verification, with the remainder to follow once they collect from your customers.
There is no limit to how many invoices you can submit for debt factoring, or to how often you can fund. Choose the invoice amounts and frequency that will best support your business goals!
The Factoring Process
Below is the typical process for a debt factoring transaction:
- Submit your invoices for completed work or delivered products. Invoices must be accurate and not pledged to a third party.
- The factor will verify your invoices and initiate a transfer to your bank account within 24 hours.
- Continue operating normally; the factor will work with your customers to secure payment.
- Once the invoices are paid, the factor will send you the remaining invoice amount minus a small factoring fee.
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Additional Advantages of Debt Factoring
Besides the outstanding benefits listed above, a debt factoring relationship with a dedicated account manager can help you transform your business in other ways:
Flexible Debt Factoring Options
As mentioned above, factoring is designed to be responsive to your company’s needs. Factor your invoices daily, weekly, or monthly. And, control your costs and maximize the benefits by choosing which accounts to factor. Some factors will also provide spot factoring, which is a one-time factoring transaction with no contract.
Credit Building & Repair
Not only can you be approved for debt factoring with poor credit, but you can also use factoring to erase your existing debt! A steady flow of working capital allows you to keep up on current expenses while paying down older liabilities. As your creditors report a solid payment history you can rebuild your credit rating to qualify for future financing opportunities.
Back Office Support
Spend more time providing great service to your customers and less time worrying about the administrative end of things. Your debt factoring company will engage in collections efforts with your customers, run credit and background checks to make sure you are working with reliable payers, and provide 24/7 online reporting so you can always stay up to date on your account – all at no additional cost to you!
If you plan to factor a large volume of invoices, your factor may provide a volume discount in your factoring agreement to further reduce your fees. Also, you can negotiate early-pay discounts and other incentives from your creditors with the confidence of a full bank account behind you.
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Starting Debt Factoring is Easy!
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No matter how long you have been in business, how large an operation you run, or what industry you serve, there is a debt factoring program available that is just right for your company. Factor Finders works with factoring experts serving every industry, including but not limited to:
Oil and Gas
Debt Factoring Can Get Your Company on the Right Track
The underwriting process is fast and simple. Submit a factoring application, your Articles of Incorporation, and copies of your current invoices and customers. The debt factoring company will review your information and make a funding decision – based primarily on your customers’ creditworthiness – in as little as 3 to 5 business days.
Don’t let your business sink under the weight of slow payments and mounting debt. Choose debt factoring with Factor Finders and move toward full financial freedom today!