- Helpful Information for Companies Researching Accounts Receivable Factoring May 01st, 2015 9:33 pm
Researching business loans produces many options for your company. During research for a funding solution, you most likely will learn about accounts receivable financing, also referred to as factoring. This type of financing allows you to sell your open invoices to a factoring company before customer payments are due. Your business receives a quick influx of cash without incurring debt. Here is some specific information about accounts receivable factoring rates and the factoring process.
How a Finance Company Determines Your Factoring Rates
Finance companies work with all types of companies, including those with little or no credit history and businesses who are experiencing tax issues. Top factoring companies will have the expertise to negotiate with other financial institutions and/or the IRS, which can be helpful if a lender already has the rights to your accounts receivable as collateral.
Even if you have been told you do not qualify for a business loan, you may still be able to access cash through factoring. Finance companies determine your factoring rates based on several variables, including:
- Your company’s sales volume
- The current climate of your industry
- Trends in your customer payment cycles
- Your customers’ credit strength
What Happens When You Sell Your Invoices
One major advantage of factoring is the quick turnaround rates for accessing cash. Application and approval can be completed within a couple business days. Your business can access cash within hours of approval. Once your business has entered into a financing agreement, you and the factoring company will work together to complete the notification process:
- You will introduce the finance company to the customer associated with your factored invoice.
- The finance company will contact the customer to redirect their payments.
- Your customer will send their payments to the finance company.
Most of the notification process is managed online and is fast and seamless. Once you have transferred your invoices to Universal FundingRu, your part of the process is completed. Selling your invoices is fast and simple, and it does not put your company in further debt.
Learn More About Accounts Receivable Financing
Universal Funding can answer any specific questions about invoice factoring you may have. Contact us by filling out our online rate form to request a no-cost consultation today.
- Preserve Your Customer Relationships With the Right Factoring Company April 30th, 2015 4:49 pm
You may have decided that factoring your receivables is the best option for your business, but still have not picked a finance company. One issue you need to consider is the finance company’s ability to work with your customers. The best factoring companies have the expertise to handle interactions with your customers smoothly and will offer you assurance that your customer relationships will be preserved.
Working With a Factoring Company
When your business needs cash quickly, a bank loan may not be a viable option. Traditional bank loans require a complicated application and a long period of time for approval. The process can sometimes take weeks or months. Invoice factoring offers your business a straightforward application and approval process that can be completed within days:
- You sell your open invoices to the finance company in order to collect payment before the invoices are due.
- You introduce your customers to the finance company, and the finance company will instruct your customers about the transition in payment management.
- Once you have received your cash and your customers have been introduced to the finance company, the transaction is complete. Your business does not incur debt or need to budget for monthly loan payments.
Since the factoring company will be communicating with your customers, you need to be sure you choose a firm that can ensure your relationship with your customers will remain intact.
Preserving Your Customer Relationships
Before you choose a factoring company, ask the financial specialists about their customer management policies. You only want to work with a firm that ensures a smooth transition of your invoices and will not harass your customers. A factoring company should want you to be successful, and part of that success involves maintaining positive relationships with your customers. Universal Funding provides you with a dedicated Account Executive who understands that your client relations are what keep you in business and will never act in a way to jeopardize your relationships or income.
Learn More About Factoring Companies
A factoring company should not harass your customers or make it difficult for you to continue business with them. Universal Funding can talk to you about our policies that maintain your customer relationships. Fill out our online rate form to request a no-cost consultation today.
- Working With a Factor Company When Finding Funding is Difficult April 29th, 2015 11:31 pm
Funding options are limited for new businesses and businesses dealing with tax problems or other cash flow issues. Factor companies provide these businesses with a fast way to access cash that other lenders cannot offer. When your business is in a period of low cash flow, you need to find a funding solution before your vendor payments, payroll and operating costs are due. Finance companies that specialize in invoice factoring can provide you with funding no matter what issues your business is experiencing at this time.
New businesses face issues with cash flow while they are getting started. At the same time, they have difficulty finding funding solutions since they have only been established a short time and may have little or no credit history. These circumstances make it hard for new businesses to get a bank loan.
Invoice factoring is an excellent option for new businesses since it is not a loan:
- You are selling a company asset. You sell your open invoices to the factoring company, and the company collects payment from your customer.
- Factoring companies consider the strength of your customer credit and your customer payment cycles, not just your credit or business history.
- Application and approval for bank loans can take weeks or months, but your business can access cash within days through the factoring process.
Factoring companies can still work with your business even if you are experiencing tax problems. Universal Funding will consider your lien amount in relation to your monthly volume and the details of your workout agreement with the government agency. It can be a seamless process where the payments are directly made to the IRS.
Find Out if a Factoring Company Can Work With Your Business
Universal Funding works with businesses in all stages and in a variety of circumstances. Contact us to find out if invoice factoring is a solution for your company. Fill out our online rate form to request a no-cost consultation today.
- Accounts Receivable Financing: An Excellent Alternative to a Business Loan April 28th, 2015 9:11 pm
When your business needs an influx of cash quickly, waiting for a bank loan to come through is not usually a realistic option. The traditional lending process can take longer than you can wait to access funds for your business needs. Accounts receivable financing is an excellent alternative to the conventional business loan. Instead of approaching a lender, completing an application, and waiting for approval, your company can quickly get payment for your invoices before they are due. A/R financing gets you money in a fraction of the time it would take to access cash from traditional lenders.
Accounts Receivable Financing and Traditional Bank Loans
Conventional lending options involve a lengthy process before you learn whether or not you are approved. The application process for business loans can take weeks, and it may be much longer before you learn the lender’s decision. There often is another waiting period before you receive your cash, and you will have to start the process over with another bank if you are not approved.
Financing receivables is a very different path to accessing cash. You sell your open invoices for a lump sum instead of going through a loan process.
- The application and approval process is much quicker, as the finance company is only concerned with your invoices.
- Your credit standing is not a significant part of the approval process since the finance company is interested in your customers’ ability to pay their invoices.
- You access payment for your invoices quickly after approval.
- There are no interest charges or need to schedule future monthly payments since this is simply a sale of your open invoices.
Selling your invoices is a less complicated than accessing cash through a bank loan. The process is quicker, and there is no need to budget repayment or interest fees.
Access Cash Without a Bank Loan
Accounts receivable financing is an excellent alternative to conventional lending avenues. To get cash for your open invoices, give Universal Funding a call today at (800) 405-6035 or fill out our online rate form to request a free consultation.
- Solving Your Company’s Urgent Cash Flow Problem April 27th, 2015 5:29 pm
When your business needs cash before payments on your invoices are due, waiting for approval for a business loan is not a viable option. Your cash flow needs to be addressed immediately if you require funds urgently enough to seek funding solutions before your customers make their payments that are 30 to 60 days out due to terms. Factoring companies help cash flow issues by purchasing those invoices and providing the funds to you more quickly than you can collect them from your customers.
Cash Flow Solutions Through Invoice Factoring
Experiencing cash flow problems can be extremely difficult for you and detrimental to your business. If you cannot purchase supplies and raw materials, for example, your operations can stall. This could result in revenue loss, restricting your access to cash even further.
Financing your receivables is an excellent way to acquire funds quickly and easily, before you experience a major disruption in business. You can receive your cash within days—sooner than your customer payments and long before business loan funding. Invoice factoring provides you with a solution to your urgent cash flow problems:
- Universal Funding can approve your application within a few days.
- Accessing the cash is possible hours after establishing your account and receiving your invoices.
- As you re-establish your cash flow, you will not need to budget loan repayment or interest charges.
Invoice factoring solves your cash flow problems faster than a business loan partly because of the fast approval process. These types of finance companies do not need to perform an in-depth examination of your company and your credit standing. Factoring companies are more interested in your customer credit strength and payment cycles.
Learn More About Factoring Solutions for Cash Flow Problems
Do not let an urgent need for cash have a negative affect your business operations. Universal Funding can help your company resolve cash flow issues. You can fill out our online rate form to request a no-cost consultation with one of our finance specialists today.
- Typical Time Tables for Business Funding Options April 24th, 2015 7:28 pm
When your business needs an influx of cash, your first approach is often to examine your open invoices. This helps identify customers who are past due, and ones who will be paying in the immediate future. If you need capital before those invoices are due, waiting for business loan approval is not likely to be an option. Selling open invoices is a faster funding solution than traditional lending avenues, providing your business with capital more quickly than waiting for invoice payments or bank approval. Financing receivables also allows you to access cash when you do not want to incur debt.
Time Tables for Accessing Cash
- Funding Options for Operating Costs April 23rd, 2015 5:32 pm
Cash flow problems must be resolved quickly when your company’s operating expenses cannot be covered. While fixed costs are predictable, revenue sometimes is not as easy to estimate. Months when cash levels are low might leave you struggling to find a solution to manage your company’s lease payments, vendor agreements or equipment rentals. When your business urgently needs funds to cover upcoming operating costs, your paid invoices may not provide revenue quickly enough to meet your needs. However, you can quickly access cash for the amounts due on open invoices by selling them to a factoring company. Invoice factoring often gets you funding faster than waiting for your customer payments to arrive.
- Make the Most of Accounts Receivable with the Right Financing Option April 22nd, 2015 5:28 pm
In many instances, the right financing can be a crucial aspect of achieving a variety of business successes. These include things like developing new products and services, or even undertaking debt management procedures to ensure continued growth is possible. Both of the above examples can greatly benefit from receivables financing, an innovative program that affords a rapid influx of funds when your business needs it most.
- How to Deal With Cash Flow Problems April 21st, 2015 5:32 pm
Whether your business is slow or your products are flying off the shelves, you may still run into cash flow problems. These problems aren’t necessarily the sign of a failing business, and many successful companies run into problems when invoices aren’t paid in a timely manner. Acquiring new debt and taking out a bank loan can take months and extensive time and research, so what are your options when your company hits a wall?
Are Your Invoices to Blame?
While some may tell you to get your invoices out quickly and set definite payment terms with clients, you may deal with corporate or government clients that are bound by their own policies. Many of these require up to 60 days to pay invoices, and you are left holding the bill in the meantime. Continue reading →
- Low Invoice Factoring Rates Can Help Your Business Succeed April 20th, 2015 9:27 pm
Most businesses will need financing at some point to maintain a successful outlook. However, conventional funding methods like loans and lines of credit may not be suitable for every business. Bank loans often entail lengthy approval periods, which can be frustrating for those in desperate need of capital. Additionally, other funding methods can result in the accumulation of harmful debt. In this event, invoice factoring can be an ideal method of securing the financing your business needs at a much faster pace.
Understanding Invoice Factoring
Waiting for payment on outstanding customer invoices can seem to take a lifetime when badly in need of working capital. That’s where invoice factoring comes in. Continue reading →
- Three Parts of the Invoice Factoring Process For Your Business April 17th, 2015 10:09 pm
Invoice factoring is an excellent alternative to a traditional bank loan when your business has an immediate need for cash. Accounts receivable factoring companies can provide you with funds so quickly because they are purchasing an asset, your invoices, rather than approving you for a loan. The process is much less complicated than a traditional bank loan, with a few simple steps for your business to take.
- Cover Your Payroll Expenses with Accounts Receivable Financing April 16th, 2015 5:39 pm
Accounts receivable financing is an excellent alternative to a business loan if your company is experiencing low cash flow. Financing your receivables is a faster and less complicated process than waiting for bank approval, and that is especially important when your company urgently needs an influx of cash. You may be able to postpone special projects, expansion plans or even compensation to certain vendors until your invoice payments arrive. However, disrupting payroll can be extremely difficult for your employees and cause major problems for your business. Receivables financing can get cash for your business within days and help you make payroll.
- Get the Facts On Accounts Receivable Factoring Rates April 15th, 2015 4:05 pm
While obtaining working capital can be extremely important for a business to thrive, traditional lending routes may not be ideal for every enterprise. This is particularly true for new businesses, as well as any companies struggling with a poor financial history.
When a business is in need of a quick influx of low-risk capital, getting a couple quotes for accounts receivable factoring rates may be worth considering. This financing method can afford a business the funding it needs to cover essential operational costs or unexpected costs. Additionally, factoring won’t accumulate debt like other lending programs, which can be detrimental to the overall success of a business.
- Industries That Can Benefit From Selling Receivables April 14th, 2015 5:13 pm
Selling accounts receivables is a great way for companies to bridge the gap between sales and cash flow, especially if you work in an industry where your customers are not expected to pay for long periods of time—30, 60, or even 90+ days after the sale is made. In the meantime if you need more cash to help keep operations running smoothly, you can sell those receivables and get working capital right away. Because of the nature of these transactions it won’t be a fit for every company, but there are certain industries that will benefit more than others.
- The Top 10 Factoring Companies April 13th, 2015 1:01 pm
When your business is looking for alternative funding strategies that go beyond traditional bank loans, there are plenty of other opportunities you can take advantage of to get the cash you need. One of the most popular financing methods that has emerged over the past few years is invoice factoring or accounts receivable financing. Here is a quick comparison of the top 10 factoring companies, according to TopTenReviews.com.