Why Factoring and Accounts Receivable Loans?
Businesses’ choose factoring for quick cash on their receivables, instead of waiting 30 to 90 days to get paid by their customers.
Factoring is a transaction by which a business sells its invoices or receivables, to a third party financial company known as a factor. The factor then collects payments on those invoices from the business’s customers. Factoring is more expensive that the usual bank line of credit. Interest rate and fees are much higher, but the factoring line can be approved in less than 15 days.
Accounts receivable financing or accounts receivable loans are loans placed for the business using its existing unpaid accounts receivables (unpaid invoices) used as collateral. It employs factoring the accounts receivable invoices as collateral. The invoices may alternatively be sold outright to a commercial lending institution for a lump cash payment for the equivalent value. Either way, there is factoring fee and may be a small third-party fee.
Accounts receivable represent sales revenue to be collected from customers and which are created whenever a business sells goods or services on credit terms. These A/R loans may also sometimes be called “factoring loans”, since accounts receivable are valued in accounts receivable loans just as they are in factoring for a cash lump sum.
We can normally turn around accounts receivable loans or invoice factoring cash payments in a matter of days (M-F), not weeks, depending on the completeness and accuracy of your originally-received documents.
Required to start:
- a copy of your ID,
- your business’s legal name, address and contact info
- your job title there or authorization of acting member
- legible copies of your accounts receivable invoices to be factored as collateral
Want to Start Today?
Get the financing your business or organization needs via a quick and easy accounts receivable loan by factoring your unpaid invoices on amounts due!
Just fill out the form below and wait for our reply to attach your supporting docs: