The following is a reprint of an article from Pepperdine University.

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Recourse factoring is a term that describes a subset of commercial finance that can be called factoring or invoice discounting.

A factoring agreement is a legal document between two parties.  

Throughout America, businesses have responded to the economic downturn by attempting to cut costs, attract new customers, and streamline their business practices. One of the best ways to do all three is by “going green” through the use of loans and accounts receivable services.

Factoring Definition made easy!

Invoice Factoring with Fast A/R Funding is kinda of like the movie "Back to the Future".  Not exactly...but kinda.  Suspend your disbelief for a minute and let me explain, if I can.  

Invoice factoring online with Fast A/R Funding

Ok.  So we are all back to work full time after a long 4th of July weekend.  Some of us had to work over the weekend.  If you didn't, count yourself lucky.  
Over the past few weeks I have seen several people come to our website after searching for the term " invoice factoring consultant".  I am not sure what exactly is prompting the searches.  It could be companies are looking for a consultant to help them find a new factor, or they could be looking for a consultant to help them with an existing relationship.  Either way, I thought I should write an article about factoring consulting working in both capacities as I have run across consultants that were new business brokers, helping people find the best factoring company to fit them and factoring consultants that help with on going relationships.  The most important thing to remember is that factoring consultants can be valuable advisors, but you should be very specific in your engagements with them and ask some very simple questions before you sign the contract.
Invoice Factoring Consultants as new Business Brokers
There are factoring companies and asset based lenders for just about every type of company selling to other businesses on open account.  Companies hire factoring consultants every day to help them find the right factoring company. When beginning the search for a new factor it can be confusing.  Most companies dont have have existing relationships with factors and don't know where to start.  Nobody works for free and factoring consultants will either be paid by you, the client, or by the factoring firm that they bring the relationship to.  No matter who is paying the consultant, the fee will ultimately be paid by you.  If the factoring firm is paying the consultant, then the chances are the cost of the consultant that is born by the factoring firm will be passed along to the client in the form of the factoring charges.  Before you sign a contract with a factoring consultant check the contract for a few simple things and make sure to call their references.

1. Is the contract exclusive? If you find a factor on your own do you still need to pay the consultant?
2. What exactly will the consultant do for you?  Will they help negotiate legal documents and help with the relationship after it closes?
3. How will the consultant be paid? Will the be paid in full at closing or can you make monthly payments over a period of time based on the length of the contract you sign with the factor.

This post if getting a little long so I will cover the issues of a invoice factoring consultant working on an ongoing relationship with a factor in tomorrows post. 

This article will focus on how personal guaranties work for companies financing with asset based lenders or factoring companies.