Application Tips

How To Compare Factoring Company Rates

Most people use a simple approach when comparing proposals from competing factoring companies: they make the decision based on who offers the lowest rate and the lowest application fee. Unfortunately, this approach usually leads to making a wrong choice. For starters, you should look for the proposal that offers the lowest total cost per dollar – not just the lowest rate. “Lowest rate” […]

The True Cost of Factoring – Why Focusing on Rate Alone is Wrong

One of the bigger mistakes that prospects make when negotiating a factoring agreement is focusing their discussions on the rate alone, rather than focusing on the total cost of the service. While it’s true that the rate can sometimes be a good measure of total cost in many financing transactions, that is not the case […]

Concerns When Switching Factoring Companies

Switching factoring companies is not for the faint of heart and, thus, should not be taken lightly. Any changes you make will impact your business and your customers. Consequently, switching factoring providers should be thoughtfully considered and not rushed. This article is not intended to replace the detailed conversations you should have with your factoring providers before you make […]

Reasons For Switching Factoring Companies

Every so often, we get a call from a prospect who wants to switch factoring companies. This article provides our perspective on the most common reasons that companies choose to change providers. However, first we’d like to emphasize one very important point: changing factoring companies is difficult and risky. This change can impact your business and your customers. You should switch […]

One Way To Improve Your Factoring Application

Want to increase the chances that your factoring application will be approved? When you submit your application, be sure to include a one-page executive summary about your business that includes the following information: Owner background Brief company history Target market Current clients Your billing process Current and expected revenues In most factoring companies, the application gets submitted […]

How to Choose the Best Factoring Company

Selecting a factoring company is one of the most important financial decisions that you will make for your business. It shouldn’t be taken lightly, since you will likely be working with the company for a while and your success depends on that relationship. This article explains everything you need to know so you can shop […]

Factoring Application Mistakes To Avoid

Many companies seek accounts receivable factoring financing because they have cash flow problems that usually stem from the fact that their customers pay their invoices in 30 to 60 days – however, these companies can’t afford to wait that long for payment. It’s common for prospects to wait until the last possible minute before applying for […]

Factoring Application Problems

Most factoring applications proceed quickly if the client company is well prepared and does not have liens, legal problems, or tax problems. Actually, many factoring companies can implement a factoring line in a week or two if everything goes smoothly. However, a number of things beyond the control of the factor could derail an application. […]

What To Do If Your Invoice Factoring Application Is Rejected

Having a business application rejected is never fun. We wrote an article offering suggestions on what to do when a business loan application is rejected. Here, however, we address specific things you can do if your factoring application is rejected. Following these steps does not guarantee that the rejection will be overturned or that you’ll be able to get financing, […]

Why Do Factoring Companies Ask for Tax Documents?

Prospects are often surprised when a factoring company asks for copies of their latest IRS 941 or other tax documents. They ask, “Why do factoring companies ask for these documents? What do these documents have to do with invoice factoring?” The reason is simple: the factor wants to be sure that there are no tax liens […]