There are many reasons your company may need to find a source of immediate funding, but there are not many options for you to explore. Your choices are further narrowed if you do not want your business to incur debt. Many traditional funding avenues require your company to take on debt, affecting your credit as well as your budget for repayments. However, invoice factoring is an excellent funding alternative to the traditional loan structure that gets you operating money swiftly and does not require your business to take on debt.
How Factoring Invoices Offers Debt-Free Financing
Factoring your invoices through accounts receivable financing is the sale of one of your company’s assets. You are selling open invoices. This process is a simple business transaction that does not leave your company in debt:
- A factoring company can approve your application within days.
- Once you are approved, you will sell your open invoices to Universal Funding, and you can receive funding for the sale within hours totaling a large percentage of the value.
- Your customers associated with the invoices will make payment out to your company and submit it via a lock box.
Since the factoring company receives payment from your customer, your business does not incur debt or need to budget monthly repayments as you would if you had accessed funding through a traditional loan.
Other Reasons to Choose Factoring
Selling your open invoices is an excellent method to access capital for many reasons. Factoring invoices provides your business with:
- A finance option that does not require collateral
- Approval that focuses on your customer credit more than your credit
- A much faster application and approval process than a bank loan
- Access to funding within days
- Cash for the invoice sale paid in one lump sum
Learning more about factoring will help you discover the many ways selling invoices benefits your business besides providing debt-free financing. Universal Funding can answer any questions you have about the benefits or the process of selling your open invoices. Contact us today by completing our simple rate form.