5 Best Construction Factoring Companies

Clarify Capital is our best overall factoring company for construction because of its low rates and flexible financing terms. Of the lenders in our guide, it offers the lowest starting rate and is the only company that extends up to 100% financing.

An advantage of working with Clarify Capital is the fact that it’s a broker with over 75 lenders in its network. Having this many financing options means you’re more likely to be paired with a factoring company that has a low rate and offers financing as soon as the next day.

Besides that, the number of lenders the broker has partnered with can also improve your chances of getting approved. In the event that you’re unsure which provider to choose, you can work with a Clarify Capital specialist to walk you through the pros and cons of each of your options. Notably, the broker can work with early-stage businesses and only needs a three to four-month history of recent bank statements to verify income.

To learn more or to submit an application, you can visit the Clarify Capital website. There, you can complete an application in under two minutes.

Capital Plus is the only provider listed in this guide with no requirements for revenue and time in business. For this reason, it can be a great option for startups with limited resources that may not yet have a history of earnings.

It is a direct lender with in-house underwriters. While this may not give you multiple options as you could get with a broker like Clarify Capital, one advantage is that loan decisions can be made fast and with more flexibility. As a result, Capital Plus can issue funding for less common and difficult scenarios. Some examples include funding bonded jobs, progress billing, and other distressed situations.

Funds obtained from this provider can be used for any business purpose. This includes hiring new employees, paying contractors or suppliers, and funding new projects. Construction factoring with Capital Plus requires no long-term contracts, and there are also no monthly minimums.

To apply or get a quote, you’ll need to complete an online form requesting a callback. You can also call the company’s toll-free number for any questions.

With 1st Commercial Credit, funding requests for less than $350,000 can be approved with no requirement for financial documents. It also provides competitive rates and loan terms, making it a good option if you’re looking for an easy approval and funding process. What’s more, it offers the second-highest advance rate on our list after Clarify Capital, as you can get up to 97%.

It commonly works with appraisers, asphalt companies, cable companies, carpenters, and electrical contractors. Even if you don’t fall into one of those categories, it can most likely still work with you if you are a construction-related firm. It also doesn’t require a designated time in business, so it can be a good option for early-stage businesses with limited operating and financial history.

To learn more, you can visit the 1st Commercial Credit website. There, you’ll find the company’s toll-free number available 24/7. You can also submit an online request for a quote

Factor Funding Company is one of two companies in this guide that has no minimum revenue requirement. While Capital Plus shares the requirement, Factor Funding Company’s rates can be more competitive. For this reason, we’ve selected it as the best provider for low revenue businesses.

Best suited for small and midsize businesses, it offers various types of financing solutions nationwide and has customized programs specific to your business needs. It has experienced professionals to help facilitate the process, including managing invoice payments, collections, and more.

To learn more about Factor Funding Company’s factoring offerings, you can visit its website, where you can get a quote or download an application. Upon review, approval and funding are generally a part of a quick process that can take up to a week.

Out of the providers we’ve selected, Scale Funding (previously TCI Business Capital) is the best direct lender to choose if you’re looking to get funding quickly. One advantage of working with a provider like Scale Funding instead of a broker is that it has a greater ability to make loan decisions, rather than needing to rely on an outside lender.

While it can work with startups similar to 1st Commercial Credit, one drawback is that it has the highest revenue requirement listed in this guide. To be considered for funding, you must invoice at least $50,000 per month on average. Notably, it offers both month-to-month and one-year financing agreements. Rates may vary per month and can fluctuate based on the value of the invoice.

With its rate flexibility options, you could actually save money in the long term because companies approved for funding do not have to sign any long-term contracts. As a result, it’s also a good option for businesses that may only have factoring needs for short periods throughout the year.

To start the process, you can submit an online application or call the company’s toll-free number.

The main disadvantage of factoring is that it may be a more expensive financing option over time. Typically, the longer it takes the customer to pay an invoice, the more expensive it is for your business since it’s paying fees to the financing company every month.

When choosing a factoring company, you should consider the various qualifications and financing terms offered by the provider. You’ll want to see to it that you meet the minimum qualification criteria to ensure better odds of approval and that the factoring company offers financing that suits your business needs with regard to funding, repayment, and fees.

Rates can vary depending on the provider, but generally, a good rate for factoring is typically anywhere from 1% to 3% for every 30-day period—but pay attention to what your long-term fees will be. This is because some providers may require a contract to factor for a minimum length of time. If you do not need recurring needs for factoring, you could end up paying more fees by agreeing to one of these contracts.