Factoring Websites Claim Unreal 1% rates?

 A quick online search shows that you will find a number of factoring companies that offer what appears to be very cheap factoring rates. Based upon what you search online, you will find claims saying you can factor your invoices for only 1%. Sometimes, the rates are even lower. How can this be? And in some advertised websites, the rates appear to be cheaper than traditional bank financing.
cheap factoring rates
Just how can factoring be cheaper compared to a conventional business loan that’s only reserved for prime customers with plenty of assets?

Let us explain this for you:

The key is to recognize how nearly all factoring rates work. Even though the rates might seem to be cheaper than bank financing, often they will not be.

Why?

Well first we need to evaluate how factoring fees are commonly evaluated. Factoring company’s commonly charge you a fee that will increase the longer that a invoice remains un-paid. This is sensible, the more time an invoice goes unpaid = the greater the cost.

Below are 2 popular techniques for determining factoring fees:

1. Ten Day Fee: This is certainly the most popular factoring fee structure. In this case, the factoring company prices a fee for a 10-day period. For instance, 1.00% for every 10 days the invoice remains unpaid, this fee adds up until the customers pay the invoice in full. The fee for the first 10 days is 1.00%. The fee for the second ten days is 2.00% and etc.

2. Daily fee: This is the most basic factoring fee model you are charged a daily fee for each day that the invoice is unpaid by the customer. An example of this would be a 0.30% fee per day. This equals about 1.00% for ten days and about 3.00% for every 30 days the invoice remains unpaid.

These illustrations have got one thing in common = the cost of factoring a invoice for ten days is 1.00%. Using this information, you could say factoring is provided at rates “as low as 1%” Definitely, just make sure your invoice are paid very quickly and in ten days or less.

in the event that you are evaluating factoring proposals, you should contemplate looking at the fee structure carefully to recognize what the total cost of factoring is going to be for you. The best way to find out – check with your factoring company for the cost of factoring invoices for thirty or sixty days. That will provide you with a good measure of the actual factoring fee cost.

If your business is experiencing cash flow issues and is in need of funding, give us a call 1-888-382-3766 or visit us online by clicking here

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What is Factoring?

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[youtube http://www.youtube.com/watch?v=xkyk–m4NWM&fs=1&rel=0&feature=player_embedded&hl=en]

To Get A Fast Quote for your Businesses Cash flow Needs
Click Here
One of our certified specialists will assist you. We offer credit lines starting at $5K up to $50 Million.

The History of Factoring Def, How Factoring Invoices Started…

Believe it or not Factoring Invoices is older than the last 5 presidents combined! If you still can not define factoring then you are most likely a business who is not using it as leverage. Almost all fortune 500 companies’ factor invoices to better manage their cash flow.  Neebo Capital is one of the top picks for US Fortune 500 companies.

Factoring def  goes like this…

The arrival of the well-known business practice of factoring invoices began since the inception of commerce that dates back 5,000 years. The earliest recorded factoring transaction of invoices was dated sometime before the revolution in the US when cotton, animal furs, timber and other materials were shipped from the colonies to Europe’s continent.

This was a way for ship sailors to carry on the harvest in their new land,  where merchants  awaited to loan their finances to the colonists.  We also see factoring def of invoices throughout the Industrial Revolution when factoring became more focused on credit when they assisted clients in determining the creditworthiness with their customers and setting credit limits.

The method of factoring invoices has been greatly approved over the years. We now have the ability to give instant quotes to potential factorees and loan then cash for their receivables within hours. Visit Neebo Capital and get an instant quote with rates as low as .59%.

 

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