|
Frequently Asked Questions about Factoring
1. What types of receivables can be
factored?
2. What is required before factoring invoices?
3. Do we bill on our letterhead?
4. What does accounts receivable factoring cost?
5. Are government receivables acceptable?
6. Does accounts receivable factoring make good business
sense?
7. What is the smallest and largest invoice that
we can submit?
8. What will my customers think of accounts receivable
factoring?
9.Can we qualify for factorings accounts receivables
with a history of credit problems such as bankruptcy, IRS liens
or judgements?
10.Can we qualify for accounts receivable factoring
if we already have existing credit lines or SBA loans?
11.Can we qualify for accounts receivable factoring
even if we are just starting a business and
have no credit history?
1. Just about any valid invoice for
services performed or products delivered may be factored.
2. Before factoring your invoices, your
customer must be creditworthy and your product or service must
be completed, delivered, and accepted by that customer.
3. You continue to bill normally.
Checks may be made payable to you, but mailed to the factoring
service.
4. Fees for accounts receivable
factoring are competitive and terms are flexible. Your industry
monthly volume, customer credit strength, and the factor will
combine to determine your fee structure. Typically fees
for 30 days range from 2 to 5 points.
5. Yes, government receivables
are acceptable. Since these are common, there are several
funding sources that specialize in this area.
6. Yes! Thousands of firms
like IBM, Georgia Pacific and Shell Oil have used this financial
tool. Now your business can take advantage of this proven,
debt-free, and flexible method to effectively multiply your working
capital.
7. You may finance invoices for
as little as $100. There is no upper limit to accounts receivables
factoring.
8. Receivables-based financing
is used by many of the largest corporations in the world to improve
cash flow, support growth, and increase profits. Many of
your customers may use factoring services themselves and others
have become familiar with it through other vendors. The
fact that you qualify for this "credit line" makes a
strong positive statement.
9. Yes! That's another advantage
of accounts receivables factoring. Making arrangements with the
IRS or the courts is common.
10. Yes! Accounts receivable
factoring compliments and works in cooperation with your existing
lenders to enable you to access even larger amounts of financing.
11. Yes, you can qualify for accounts
receivable factoring, if you have creditworthy customers.
|
