A company has been struggling to make a go of it and they’ve been bootstrapping using the owners personal resources. The company labors on for the first couple years maxing out credit cards etc. Finally they begins to gain traction and land some contracts. Meanwhile the owners personal FICO scores have taken a serious hit due to the start up phase.
Conventional sources of capital like the neighborhood bank are out of reach because of the weak personal credit. Although inundated with offers for quickie business loans, cash advance is an expensive and incorrect method to finance the lack of ongoing working capital to pay for payroll and operational expenses.
Enter invoice factoring where our decision to fund is based solely on the creditworthiness of the account debtor (the customer.) With factoring, a company is only limited by the credit reports we find on the customers – and we even look it up for you before you sell to them so you know up front what the payment terms should be offered.
So the main benefit of engaging factoring as a commercial finance solution is to transfer the indebtedness from you the client over to your customer who owes on the invoice for the work you already completed. You’re actually not borrowing capital, you are selling your own loans at a relatively small discount.
This handy tool is available in a quick and efficient manner meant to not disrupt your normal daily operations. Invoice factoring, call us for details.