Loans and Receivables with Fast A/R Funding.
In my conversation with clients there seems to be some confusion about the difference between:
factoring
Invoice Discounting
Loans and Receivables
Invoice financing
The truth is that all these terms generally mean the same thing.
While generally very similar, all of the above facilities can be structured differently. The following is a short summary of the different nuances to a loans and receivable facility that all business people looking for a new commercial finance company should be aware of:
- Recourse - Will the invoices be purchased with recourse? Basically this means that if your customer doesn't pay the invoice that was sold to the factor is your company still responsible for payment to the factor.
- Notification - Will your customers be notified of the factors involvement? Usually an invoice will be labeled as due and payable to your factoring company at their business address.
- Guaranty - For most companies with annual revenue under $10,000,000 factoring company will ask you to sign a personal guaranty making you responsible for the advances the factor makes to your corporation.
These questions above are good questions to ask any loans and receivable company at the start of the process.
At Fast A/R Funding we are a recourse finance company that will notify your customers and ask you to sign a personal guaranty.
That being said we have built our software to be as fast and simple as possible. Instead of buying an off the shelf factoring software package, we built our own, so we can:
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Process applications online
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Make free invoice creation software available to our clients
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Sign electronic documents
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Make advances
