What is Process of Factoring?
The Process of Factoring is:
- Complete the factoring application and submit with the required documents (A/R aging, sample invoices, Vendor Agreements & Purchase Orders)
- Receive a written proposal outlining the terms and rates from the Factoring company
- Sign the proposal and the Factor finishes final due diligence, sends you the Factoring Closing documents for you to sign and begins verifying your invoices
- After verification, monies are wired to you
- You continue to send the factor new invoices every day/week and funding’s continue
- When your customers begin to make payments, you receive your balance owed (earned reserve) minus a factoring fee
Audio Definition/Pronunciation
RELATED TERMS
- Factoring
Invoice Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (invoices) to a third party (called a factor) at a discount. A business will sometimes factor its receivable assets to…
- Freight Factoring
Freight factoring, also known as transport factoring, trucking/truck factoring, and freight bill factoring takes invoices and turns them into cash. Instead of waiting for 30, 60, or 90 days to be paid, freight factoring unlocks money already earned, so you…
- Invoice Factoring
Invoice Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (invoices) to a third party (called a factor) at a discount. A business will sometimes factor its receivable assets to…
