Best Factoring Service | Side By Side Reviews
When it comes to finding Invoice Factoring Services comparing quotes is the key to getting a top product for the lowest price.
We've gathered information on the top 10 Factoring Service Solutions, user reviews, and buying tips, and made it easy to get the best price from companies in your area.
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Top Invoice Factoring Companies
If you're looking for a company you can start working with, like today, then Fundbox is for you. They have a short application process that the people who work with them love.
You don't need to have a crazy impressive credit score either – you don't even have to show the one you have. There are no credit score requirements.
Their other financial borrower qualifications are pretty relaxed too. They have quick and helpful customer support for anyone that works with them.
They've been around since 2013, so you can trust them with your money.
They're best for businesses that are looking for a company that's easy to qualify with. You'll get started quickly and it's themed for small businesses. What else could you want?
The founders of this company have been in the finance industry for years, and they wanted to create something that would make it easier for small business owners. They know how difficult getting access can be so their AI-powered platform comes to speed as well as intuition when you need help.
Fundbox is an unconventional lending agency that helps small businesses to unlock their potential by providing financial agility and peace of mind. They don't do any of the work for them, so they can focus on what matters most – growing the business at just the right time.
To answer the question we just posted – what else could you want? Well, you could want a company that works better with large businesses.
You'll find that in Lendio, but that's not the end of the nice list. They also have some low-key credit score requirements. They're more personalized than our last choice, as they're more like a brokerage.
They match businesses that want to work with them and funders. They work with big names you'd know in the finance game like Amex and Kabbage.
Let's talk for a minute about why that's a good model. You do less work as the consumer and the service seeker, while they do the work for you.
Lendio is helping small business owners go from being just entrepreneurs to visionaries and craftsmen. Our loans empower them so that the American dream is built for everyone!
There aren't a lot of lenders on this list with as long of a pro's list as this one. Street Shares have everything that our first two picks have, plus some.
They not only have relaxed borrower qualifications, but they've streamlined their application process. They started out working just for veterans, but they've opened up their process to the public.
You can even get a line of credit for them, for an APR as low as 7%. Finally, there are no prepayment penalties if you're feeling flush and want to pay early.
Do you need a lender that works in the US and in Canada? People with businesses on both sides of the border can check out Riviera Finance.
They're pretty quick working, as you could get paid tomorrow. You will pay some higher fees for that convenience, but if it's worth it for you, then get your cash now.
They've been around for a while, around 50 years. They have over 1,400 clients and over 25 invoice factoring company offices.
That means there are always people on the ground if you need help. Founded in 1969, Riviera Finance is nationally recognized as a leader in business financing. With offices throughout North America to provide face-to-face service and expert financial solutions for small & medium-sized businesses; they have an excellent credit rating that has shown consistent positive earnings ever since their inception over 40 years ago.
Riviera understands what it means to be financially secure. To an entrepreneur or small business, security is having the freedom of expanding into new opportunities without worrying about finances – not only being able but also willing enough for growth and success. As one of North America's premier commercial finance companies with over 50 years of experience providing sound financing options specifically tailored towards these needs – Riviera's vision has been achieved today by thousands more entrepreneurs around our continent alone because they know full well how much their future successes depend on us: The very same team behind them every step along the way; lending a hand when needed so that all may prosper together in harmony as equals underprivileged members within society.
So far, this is the most contractually strict company on our list. However, that doesn't mean it's not a good company. American Receivable doesn't have any monthly minimums, so you can customize the way you use their services.
They have an easy application process and don't have any credit score requirements. On top of all that, they specialize in funding startups and small businesses.
On the downside, they will charge you some additional fees, depending on your usage. Make sure you like their company before you say yes because there's a long-term contract required.
American Receivable has been providing small businesses with the financial resources they need for decades. They do this by speeding up the cash flow that you have tied up in accounts receivable and turning over half of all invoices we receive from our clients within 60 days, so they can compete more effectively in a marketplace where delayed payment is becoming increasingly commonplace.
American Receivable is a company that offers world-class, tailored cash management services for its clients. American Receivables provides value-added financial products and reports which allow them more time to focus on day-to-day activities of the business with ease!
Maybe you don't have anything in Canada, but you do some business across the pond? Calverton Finance services the UK. They're friendly and confidential – though it's safe to assume the others are as well.
They do quick approvals, which is great if you're working on a London to US schedule. They also offer other products, like payroll and back office software.
It's their 20th anniversary, so you know they have to be doing something right.
Gulf Coast Business Credit
Don't get put off by the name, because this company offers its services nationwide.
They did start in the Gulf Coast though, so their offices are in that area. In New Orleans, to be exact. The company is bank-owned and FDIC regulated, so you know your money is extra secure. They're a direct lender, so they don't have to factor out to third parties.
Since they're not a middleman, they offer lower rates than some of the other companies on this list. However, that does make them a little less flexible in the types of clients they take on.
Gulf Coast Business Credit is here to help your company get back on its feet. With their immediate assistance by turning outstanding invoices into cash, they can provide a helping hand when the going gets tough and give you peace of mind knowing that everything will be taken care of from there. Gulf Coast Business Credit offers financing solutions for your business without the high costs usually associated with outside sources. As a division of Gulf Coast Bank & Trust Co., we have access to lower cost funds that are passed on in form of competitive fees!
This Tennessee-born and bred company is best for small businesses, and what small means is up to their discretion. CapitalPlus Equity can, and has, refused certain customers because of their business size or revenue.
If you do get in, though, you can expect a good amount of perks. There aren't any credit score requirements, and the application is quick to fill out (they have to accept you, though).
The qualifications aren't too strict, save for the business size. Their terms and fees are reasonable, though not the lowest in the industry.
If you're a B2C business, you may want to skip out on this company – they work mostly with B2B. If you're B2B and in the medical or trucking industries, then you're out of luck here as well.
Capitalplus offers construction companies a quick and flexible way to get the cash they need. Their two main products, Receivables Financing & Materials financing will provide your company with financial support so you can focus on running core business activities without any worries of losing money.
Finally – you need to be committed to doing business with them. They have a minimum schedule of $6.5 thousand worth of services.
Harper Partners are the people who founded this business were small business owners first. They know how hard it is to close a cash flow gap and wanted to come up with a solution.
And they did so, right out of college. Good on those two go-getters. They came up with a company low on credit requirements and easy to start working with.
However, this company too is only suited for B2B's. You may be subject to some extra fees, depending on the level of services you need.
But even with those fees, the terms and conditions are pretty competitive, so it may all even out. The company prefers to lend to digital marketers and advertisers, but they'll consider all applicants.
They even work with businesses in Canada for some over-border transfers.
Harper Partners is the perfect partner for growing companies. Their expertise in receivables and cash flow is unparalleled, as we know how to get you back up running quickly without tying yourself down with debt or equity financing that might slow your growth trajectory.
For those looking forward to tackling a new challenge – whether it be increasing demand from customers by supplying them better quality products; securing more funding with Harper Partners so that all future projects don't need pre-funding commitments again.
Paragon Financial Group
Paragon Financial Group – which is going on 25 years old. They work with both B2B and B2G partners and pass some big money through their doors.
They're ready to work with startups and even those who aren't traditionally lend-friendly.
They have no credit score requirements and the fees/terms are reasonable. The relaxed buyer qualifications are great to boot, though there may be some additional fees along the way.
They're based in Ft. Lauderdale, FL but will happily work with people outside of the Sunshine State.
Financial planning is a challenging and confusing process, but Paragon Financial Group is here to help you strategize your way through it all. By working closely with their clients on the often daunting task of putting their financial house in order they can feel confident about themselves as well as understand what steps need to be taken next towards achieving those goals.
If done correctly good finance will provide clarity too so let us guide how bests possible while also being mindful that life changes constantly which means plans might no longer work if made beforehand.
How Do Factoring Services Work?
Let's say you go online and you buy a hot tub. You agree to pay $323 a month for six months to cover the cost of the tub.
The company that sells you the tub isn't going to get the full price of the tub until it's all paid off. Yet, they're down inventory. To get their money, they go to a factoring lender.
Essentially, the lender buys your loan from them. Your money still gets paid in the same place – but you're paying it to the factoring company.
The factoring company gives the hot tub company the entire cost of the hot tub at once, minus some fees and terms. They get paid all at once, yet you're still on a payment plan.
That's how it works from a consumer side.
On the business side, it works like this: you send proof of purchase or an invoice receipt to the factoring company. They send you an advance of the full amount. It's normally around 75 to 80 percent of the total.
Once the client pays off the full amount, then you get the rest of the money, minus whatever cut they take.
It could be two payments (advance, then rebate) or the company could give you more than one rebate. Like 10% every two weeks – this is called “batching” the rebate. There will be a smaller cut out of the batches, but it'll add up to about what you'd pay with only two payments, if not a little more.
The cut they take is what we were talking about when we talked about terms. They are a service you're using, so there's going to be a cut taken out.
You can pay extra fees for things like needing more than the agreed-upon advance percentage or longer client payment times.
You have to do some calculations to find the ideal lender – that is, one whose fees will still allow you a profit.
What to Look for with a Factoring Service
First things first, you need to know if they're willing to lend to you. Check if they do B2C, B2B, or B2G before you go any further.
Once you've figured out if they serve your market, then you can do more research. Like, can you qualify? What is the minimum amount of profit you have to make for them to take you on as a client?
Twenty-five thousand in profit is on the low end for factoring services to lend to. Once you've figured all that, take a look at the cut they take. Would it cut into your profit too much, or could you handle it?
Remember, hiking up your retail prices isn't the easy answer – the fees are based on the final purchase price.
With all that in mind, check out their payment schedule. What amount will they give you at first, for your initial advance?
Remember, this is money you wouldn't have had for months – so anything above 50% is a reasonable first advance. After that, when can you expect your rebate? And in what fashion?
Will you get it once or do they batch it into smaller payments? Invoice factoring is complex, but a good enough company will walk you through it.
With all that information mapped out – you can go ahead and apply.
What Is an Invoice Factoring Service for Truckers?
Truckers are usually B2B or B2G – but they work through brokers. A broker finds the trucker and hooks them up with the freight client.
The freight client pays the broker and the broker then pays the company. Sometimes it's a little more direct, but it's normal for truckers to have large gaps in cash flow.
So, instead, they use invoice factoring to get the cash they need for this trip or their next one. It works just like it does for other companies but can move a bit slower due to the extra middleman.
What Should Invoice Factoring Services Cost?
Well, they're done by interest rate, like a credit card. You shouldn't have to pay for a membership or anything like that, though there may be some sort of yearly fee for service.
Price-wise, what you're looking for is the interest rate that they take out of the refund. For example, you could get a 90% advance, then pay 0.25% per week on the rebate until your client pays their invoice in full.
The better your company's profit and credit score are, the more you can get, quicker. You also qualify for lower interest rates with a higher credit score – just like a credit card.
Think of it like a very short term loan and it should all make sense.
Making Your Choices
If you need cash now, then an invoice factoring company can get money in your bank account. Some of them will do it as soon as the day after you submit an invoice.
But this isn't free money. They charge a fee for helping you out – as they should.
The fee you choose to pay is up to you. For more information about these and other lenders, click here.
- Compare Factoring Service Prices
- Factoring Advantages and Disadvantages
- RTS Financial, BlueVine, Crestmark, and Fundbox Review
What are some other advantages of using a factoring service? Consider just a few:
- Factors manage collections from your customers, giving you more time to focus on your business.
- Factoring is based on your customers' credit, not your own credit or your business history.
- Factoring is not a loan, so you don't incur debt or repay interest.
- Factoring can be adjusted at any time to suit your business needs.
- Factoring is scalable, which means the amount of funding you get can grow as your receivables grow.
Whatever your business needs, factoring can provide the service solutions you're looking for.
Factoring Your Way Into Free Cash Flow
When you choose a factoring service that's right for your business and your customers, you can derive a whole lot of value from freeing up cash flows sooner rather than later. Do some shopping around, and stop letting long payment periods and unpaid invoices be a negative factor in your cash flow.
Need some quick cash for your business? Invoice factoring may be the way to go. Find out about the best invoice factoring services here.
These lenders buy off invoices from companies so you get your client's money in advance. Then they keep a rebate and you pay interest on it until the client pays the amount in full.
Sound a little counter-intuitive? That's okay – it's a lot to wrap your head around. The above comprehensive guide should be helpful.