What is Factoring?

Converting Invoices into Cash

Factoring is the purchase of an asset, your accounts receivable (invoices), from your business at a discount. In return, cash that is normally tied up for a 30, 60 or 90 day waiting period becomes immediately available to you. Having this additional cash allows you to take advantage of growth opportunities, reduce debt or pay daily or monthly operating expenses. Factoring is a fast, easy and flexible way to improve your cash flow and generate working capital for your company so you can achieve the success you are striving for.

Factoring has evolved far beyond its early roots in Colonial days and has emerged into a widespread financial alternative for businesses of all types. The volume of invoice funding in the United States exceeds $150 billion annually. Businesses use factoring to generate cash to pay bills, allow for growth, and create greater profits.

Factoring is not a loan. It is the purchase of an asset, your accounts receivable, at a discount by a financial institution called a factor. A traditional bank loan uses all of your company assets as collateral and typically requires personal guarantees. Factoring relies on the credit-worthiness of your customers, not your balance sheet or history.

Unlike a traditional loan, factoring does not add debt to your balance sheet, and there are no loans to repay and there are no monthly payments of principal or interest. By selling your accounts receivable to a factor rather than borrowing from a bank, you simply convert one asset (accounts receivable) into another asset (cash). You can factor accounts receivable to improve your cash flow or help to accelerate your growth. There are no lengthy applications or loan committees. Factoring can be short-term or part of an ongoing financing program. New companies can benefit as well, since there is no requirement for a long-term credit history.

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Why our Clients Use Factoring As a Powerful Financial Solution

Our clients have discovered that factoring is a great resource for streamlining their cash flow. The process is very easy and assures that cash is always available if and when it is needed. Factoring with us is a powerful financial solution because it allows our clients to:

• Obtain a source of cash flow to grow their business


• Utilize a secure and professional credit checking and collection payment system that reduces bad debt loss


• Use a flexible funding program that increases as sales are increased


• Receive working capital to pay suppliers quickly, take cash discounts, pay operating expenses, and increase credit limits with suppliers


• Have a managed accounts receivable system that includes invoice processing, invoice posting, and invoice reporting so that time is freed up time for other revenue-generating activities such as sales and marketing


• Access cash to pay bills, pay employees, and invest in the growth of their business creating greater profits

Factoring is an extremely powerful cash management tool to the business world. This is because the most important aspect of the transaction is not the credit-worthiness of you or your company; it's the credit worthiness of your customers. So, factoring is a fast, easy, and reliable financial service that allows you to access cash based on the financial soundness of your customers.

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How Do I Qualify For Factoring

You can qualify for factoring services as long as:

1. You deliver a quality product or service to another business
2. You sell to credit worthy customers
3. Your accounts receivable are unencumbered

We can provide factoring services to most types of businesses, Including:

1. Manufacturers
2. Distributors
3. Wholesalers
4. Service Providers

While our clients represent many different industries, they all begin using accounts receivable financing services for the same reason; they find themselves in need of cash or growing faster than current cash flow can support.

Is your business…

1. A young company with creditworthy customers, but lacking the financial history required for traditional lending?
2. Doing well, but looking to take advantage of new sales and profit opportunities requiring increases in cash flow?
3. Experiencing operating losses (perhaps already filed for bankruptcy)?
4. Struggling with poor credit and/or tax related problems?
5. Growing rapidly, but with too much money tied up in accounts receivable and thus cannot fill orders, provide service or pay operating expenses?
6. Positioned to increase current volume, but reluctant to take on additional debt, increase overhead or add an equity partner?

If you answered "Yes"" to any of these questions, factoring may be your solution.

See how factoring can put cash into your business today!

Click Here to Pre-Qualify Immediately On-line or Call us to Pre-Qualify Immediately at (215) 537-0315.