Frequently Asked Questions

How to Offer Net-30 Payment Terms

Most commercial sales typically have payment terms that give clients 30 to 60 days to pay an invoice. Offering payment terms is a way of extending credit to your customers and must be done carefully to avoid problems. In this article, we cover: What are payment terms? Why do companies ask for terms? Financial risks […]

Why Do Purchase Order Finance Transactions Require Inspections?

Most purchase order finance companies typically require that the goods they are financing be inspected by an independent company prior to shipment. Usually, the inspection company verifies that the quality, quantity, shipment date, and other parameters meet the specifications of the purchase order. The inspection clause is usually written into the language of the letter […]

Is Invoice Factoring Right for My Business?

Getting the wrong type of financing can negatively impact your business. It could even put you out of business in some cases. Unfortunately, many small business owners get the wrong type of financing for their companies. It may solve short-term problems but ultimately backfires. This article helps you determine if invoice factoring is the right […]

How to Choose the Best Factoring Company

Choosing the right factoring company is essential to the success of your business. The factoring market is very competitive, with many providers and different offers. In this article, we show you how to select the best factoring company for your business. Note: If your business is based in Quebec, read this guide. Is factoring right […]

What is a Factoring Notice of Assignment?

The Notice of Assignment (NOA) is a document that factoring companies use to notify your customers that your company is using invoice factoring. Most factors have a customized version of the NOA. However, the NOA usually informs your customers: That you are working with a factoring company To submit payments to a new account/address About […]

Advantages and Disadvantages of Invoice Factoring

Factoring financing has been gaining traction as a way to finance a growing business. It’s a solution that allows you to finance slow-paying invoices from creditworthy commercial clients. Accounts receivable factoring improves your cash flow and provides the financial resources to cover business expenses and grow. If you are not familiar with this type of […]

Should You Factor Invoices That Are Collections Problems?

Factoring companies often get calls from prospective clients interested in factoring invoices that are hard to collect. These invoices tend to be substantially past due and have become collections problems. The prospect hopes that the factor will buy the invoice and take on the collection problem. Past-due invoices that have become collections problems cannot be […]

Can an Invoice be Factored Before Delivery?

Every so often, clients want to factor an invoice that has not yet been fulfilled. Basically, the invoice is for work that is about to begin or products that will be delivered soon. These invoices are commonly referred to as pre-delivery invoices. Unfortunately, these invoices cannot be factored. This article explains why factoring companies cannot […]

The Importance of the Accounts Receivable Aging Report

The Accounts Receivable (A/R) Aging report is a critical tool for managing your business. This is why most lenders and factoring companies request this report as part of their due diligence process. Unfortunately, it’s one of the most valuable yet underutilized reports. This article helps you understand the value and uses of the A/R Aging […]

Why Can’t You Factor Net-90 Invoices?

Every so often, a client may want to factor an invoice that is due in 90 days or more. These types of invoices become more common during difficult economic times. Unfortunately, some larger companies are permanently moving their payment terms to net-90 and beyond for all suppliers. This time frame may help the larger company’s […]