Invoice Factoring Services

Invoice factoring is a form of short-term financing that allows businesses to receive cash advances in exchange for the right to receive payments for invoices. Many businesses can benefit from using invoice factoring because it can help them improve the management of their accounts.

Many businesses have questions about how the invoice factoring process works. Therefore, please read the following list of frequently asked questions about invoice factoring that can help you understand the basic ideas behind invoice factoring.

“How can I tell if invoice factoring is worthwhile for my business?

Generally speaking, businesses should consider their profit margins and growth potential prior to applying for factoring funding. This is the case because most businesses with larger profit margins and growth potential can afford the cost of our services.

Please let our firm know if you assistance deciding if invoice factoring is worthwhile for your business. We’d be happy to help you decide if our invoice factoring services are worthwhile for you.

“What happens during the invoice factoring process?”

Clients that use invoice factoring complete a 4-step process to obtain financing for their invoices. Here’s a quick overview of how this process works.

  • Step 1: A company receives an invoice for a good or service provided to a client. The invoice can be for most any verifiable good or service provided to a client in advance.
  • Step 2: The company sends a copy of the invoice to an invoice factoring firm to negotiate a sale price.
  • Step 3: The factoring company researches the invoices to determine a fair sale price.
  • Step 4: The client accepts the offer and receives payments for the invoice.

You can continue to send invoices for factoring as long as you wish provided you continue to send invoices to clients. As a result, it’s easy to see how you can use invoice factoring to finance your company’s business needs.

“How do you determine a purchase price for invoices?”

We use three criteria to determine a purchase price for invoices:

  • 1) Your client’s credit history.
  • 2) The amount of time needed for your invoices to be paid in full.
  • 3) The number of invoices you factor each month.

These criteria are used because they give us the information we need to manage efficiently the risks associated with providing cash advances for invoice payments. As a result, we often ask our clients to provide as many details as possible about their invoices. We ask for these details because it allows us to offer the best price for your invoices.

“How do I receive money for my invoices?”

Generally speaking, clients receive two payments for their invoices. The first payment is the cash advance we offer you in advance for the right to obtain your future invoice payments. The second payment is called a “rebate.” We issue rebates to clients after their invoices have been paid in full.

“How do you receive money for my invoices?”

We receive money for your invoices by deducting a percentage of the rebate clients receive after their invoices are paid in full.

“What types of invoices do you accept for factoring?”

We generally accept invoices that are due within 30, 45, 60 and 90 days. We factor these invoices often because they offer clients the most value for their accounts receivable. However, in many cases we might be able to help you factor invoices that are due within 180 days. As a result, please ask us today for more information about our invoice factoring services.