Understanding Your Financing Options
Lending Overview
Factoring is a transaction in which a business sells its accounts receivable to a third-party financial institution (factor) at a discount in exchange for immediate cash. It is a form of short-term financing that allows businesses to access cash quickly without having to wait for their customers to pay their invoices. Here’s how it works: A business sends invoices to its customers for goods and services. The business then sells the unpaid invoices to a factor at a discount (typically between 1% and 5% of the invoice). The factor advances a percentage of the invoice value to the business, typically 70% to 90%. This provides the business with immediate cash flow to meet its financial obligations. The factor then sends the invoices to the customers and collects payment when the invoices are due. Once the factor collects payment from the customers, it deducts its fees and advances the remaining balance to the business, minus the discount.
Maximizing Your Financial Resources
How to Effectively Apply Funds
Factoring gives Florida-based businesses access to cash as needed, without having to incur loan costs or submit multiple applications. Once you have a relationship with a factor, it’s usually easy to submit future accounts to be paid. Factoring offers the flexibility to increase cash flow on your terms, as needed, without being obligated under a long-term agreement. Factor a few invoices to get ahead on expenses or factor an entire contract and simplify your accounting process. Instead of trying to predict when payments will come in, a contract factor can send you funds on a consistent date each month. Find out more by reaching out to our professional brokers.
Streamlined Steps to Your Loan Approval
Our Process
PRE APPROVAL
We evaluate your business based on your unique operating structure and objectives. You’ll receive financing options based on what it is you want to achieve.
LOAN SELECTION
Together we will hone in on the options and pathways to capital that make sense. We vet multiple lenders to match you with the right money.
PATH TO CLOSE
Whether your loan is fast-closing or carefully vetted, we work with you and your lender to package it and facilitate a smooth close to shorten your time to funding.
Leverage Your Accounts Receivable
Strategic Uses
Utilize factoring to bridge cash flow gaps, fund new projects, or manage seasonal fluctuations efficiently. By converting your receivables into cash, you can focus on running your business with enhanced agility and confidence.
Contract Factoring
Contract factoring is a financial solution that allows businesses to take charge of their payment timelines while ensuring consistent cash flow. By selling all invoices from a specific client to a factoring company, businesses can benefit from discounted rates and immediate access to funds. This arrangement not only frees up resources tied to waiting for client payments but also shifts the responsibility of payment collection to the factor. As a result, companies can concentrate on their core activities and productivity, knowing that their cash flow is secure and uninterrupted. Engaging with a knowledgeable broker can help tailor a Jacksonville, Florida sourced contract factoring agreement that perfectly suits your business needs, enhancing financial stability and efficiency.
Purchase Orders
Purchase order financing is an advantageous solution that empowers businesses to take on larger projects without the burden of waiting for material acquisition. When faced with substantial orders, the necessity for upfront capital can be a significant hurdle. Purchase order financing bridges this gap by providing the immediate funds required to fulfill large orders. This financial tool ensures that you can secure the resources needed for production, construction, or any expansive job, enabling your business to operate without interruption and seize growth opportunities. Collaborating with a seasoned broker can help structure a purchase order financing agreement that aligns with your business’s financial strategy, ensuring continued expansion and success.
Invoices
You no longer have to wait 30 to 90 days on payment for the goods and services you’ve worked hard to deliver. Regardless of your credit, you can bring in working capital faster when you sell your outstanding invoices to a factor. Choose how many and how often to factor to fit your schedule. This flexibility means you can manage cash flow on your terms, ensuring you always have the funds you need to keep your business operations running smoothly. Moreover, invoice factoring allows Jacksonville and other Florida-based businesses to maintain strong relationships with clients, as the responsibility of collection is handled by the factor, freeing up your time to focus on growth and development. This financial tool is a powerful ally in fostering a stable and prosperous business environment.
Immediate Financial Relief
Advantages
Unlock immediate access to capital with our Jacksonville, FL factoring services, turning your invoices into instant cash without the wait. Improve your liquidity and strengthen your financial stability to meet operational demands and seize growth opportunities.
Quick access to cash
Increased credit capacity
Reduced risk of bad debt
Flexible financing
Answers to Your Key Questions
FAQ’s
Q. Is factoring a loan?
Factoring is different from a traditional loan in that you don’t need to pay the money back. However, the factoring company may charge interest for late payments and seek a return of the funds if the accounts receivable aren’t paid on time. To find out more about the risks and benefits of factoring, speak with your broker.
Q. Do I need good credit to use factoring?
Factoring is based on your customer’s payment history, not your credit score. This makes it an ideal solution for newer businesses and those undergoing credit repair. It’s an asset-based financing product, which relies on the value of the accounts receivable asset to secure the transaction.
Q. What kinds of businesses can’t use factoring?
If your business requires payment on delivery, you likely won’t have invoices or contracts to factor. In this case, talk to a broker about lines of credit and working capital loans that can give you access to cash without AR assets.
Q. What happens if I default on a hard money loan?
Apply For Funding Today
Our no-obligation pre-approval gives you the information you need to know about loan types and options to help you move ahead, even if you’ve been denied elsewhere.