All Financing Articles - Page 2

Businesses in the medical industry are the most sought-after invoice factoring customers. This is largely due to the reliability of their debtors and the experience that factoring companies have in servicing this industry. Therefore, medical businesses seeking invoice factoring can be selective and shop around for the best rates and terms for their invoices. Top…

Factoring companies make money by charging a factoring fee, which they either calculate based on the number of days a factored invoice is outstanding or as a flat rate per invoice. In some cases, invoice factoring includes additional fees designed to encourage borrowers to factor a certain number of invoices or to maintain an open…

Small business owners who use invoice factoring will be required to authorize a notice of assignment the first time a lender factors an invoice. This notice is intended for the business’s customer and informs them the invoice is now payable to the factoring company instead of the business. How a Notice of Assignment Letter Works…

Factoring companies provide capital as a relative portion of the invoice value. The portion they advance right away is called the advance rate and usually ranges from 75% to 95% of the invoice value. Advance rates typically vary based on the industry, due date, volume, and debtor’s credit in a factoring transaction. Small business owners…

Small business owners who apply with an invoice factoring company will receive a factoring agreement outlining their rates and terms. This agreement should outline the agreed-upon rates, terms, and conditions to be followed throughout the factoring relationship. Factoring agreements usually last from between one and three years, at which point they can be renegotiated with…