Factoring is the purchase and sale of accounts receivable, represented by invoices, at a discount. An "account receivable" is money owed to your company
by your customer for goods sold and delivered and/or services performed. The "discount" is the face value of the invoice (100%) minus the advance
rate paid to you by the factoring company. Since we advance 80%, the discount is 20%. However, you are entitled to a portion of the discount
depending upon the timeliness of collection, in the form of a "Rebate."
How do you handle problematic invoices?
Invoices become problematic if they become older than 90 days, are disputed by your customer, or your customer mistakenly pays you. Therefore,
problematic invoices represent money you owe back to us, which must be repaid either from your unpaid rebates, all or part of advances regarding
new transactions, or by some other means.
Explain your factoring agreement
It is flexible
You can factor when you need to, but you can't inconsistently factor and not factor invoices for the same customer. We call this the "Rule
of Reason," because your customers will set us up as the payee and will become angry if you attempt to turn that on and off. So, pick the
customers you want to factor and factor all their invoices.
No initial setup fees
No early termination fee
No minimum requirements
Each daily batch or group of invoices is one transaction
We charge $25 for each wire transfer and $.20 (20 cents) for each invoice backup document fax page we receive, which is the exact cost I-Fax®
charges us. There is no charge if you scan and upload your paper documents or computer word processing files, spreadsheats, Adobe PDFs, graphics
files, etc.
Explain "Paperless Factoring"
Our partner Equifax®, an online notary, will authenticate your identity when you apply
You will electronically sign all legal documents (eg., factoring agreement
Invoices are either created on our website with our exclusive software or uploaded from Quickbooks®
You will either fax or upload your backup documents
All communications is handled by email, SMS (cellular text messages) and web pages
Therefore, all information and documentation regarding the factoring process is in digital form
Do you deal with Brokers?
Commissions
Yes. Brokers are paid 1% of the amount a referred client factors when the client is funded, rather than after collection, which is the industry standard,
as long as the client continues to factor. Fillable-Faxable Client Registration Form.
The $199.95 Home Study Course for Factoring Brokers
National Factoring Academy, a division of 21st Capital Corp, offers a Home Study Course which teaches all aspects of the factoring industry.
Click here for more details.
Assignment of Contract Proceeds
This document is required by the Federal Acquisition Regulations. Fill it out on your computer monitor. Press the
tab key to move from field-to-field. Print 4 originals.
If your organization is a corporation, affix the corporate LLC seal to all four copies where indicated.
The corporate president and secretary LLC manager must sign all 4 copies. Otherwise, the one signer's signature
must be notarized on all 4 copies.
If your organization is an LLC (limited liability company), the manager of the LLC must sign the document and
his/her signature must be notarized on all 4 copies.
Corporate Resolution in lieu of corporate seal
If your organization is a corporation and you are unable to affix the corporate seal to the Assigment of Contract
Proceeds, the corporate secretary must fill in the above corporate resolution, sign it and send a signed original
to the contracting officer.
The document the Invoice Approver at your customer authenticates (electronically signs) on our website to approve your invoices. The encoded fields
are programmatically filled in, as follows:
${client.displayName}: Your company name
${debtor.name}: Your customer's company/organization name
${contact.name}: Invoice Approver's name
${contact.email}: Invoice Approver's Email Address
No. You cannot mail, deliver, etc. your own invoices to your customers
Since factoring is a purchase of your invoices and not a loan collateralized by your invoices, your invoices must be paid to us, and not
to you.
Our invoice form contains special assignment language required by the Uniform Commercial Code (UCC).
We mail all invoices to our clients customers. If they were also to receive invoices from our clients, they would have two (2) invocies,
and become confused. This will slow down the payment process and increase your factoring cost.
Receipt of payment by you is a breach of the factoring agreement.
We mail all invoices using our templated invoice form.
