In order to factor invoices – receive advances on accounts receivable, the work must be completed and accepted. Whether you provide a service or sell a product, the customer has to be fully satisfied with the transaction. A factor cannot extend credit on unfinished business. By assigning the proceeds of an invoice to the factoring company you step out of the collections loop. Ultimately the factor alone must have the ability to enforce payment.
Factoring is not for “almost there we just need some extra money to finish” situations.