|
 Procedure: Steps Involved in Factoring
1. First, you need to qualify and establish a factoring relationship with us. That takes a week or less. A critical part of our due diligence process is doing credit checks on your largest and best customers. If their credit ratings are good, there's a good chance you'll qualify for this type of financing. However, if none of your customers have a decent credit rating; your business will not qualify for factoring. Also, as part of our due diligence, we'll run a criminal background check on you. Although your credit rating may not matter, it is important for us to know what type of person we are potentially getting involved with. Once you qualify and an account is estabished, you can get the cash you need within a day or two.
2. The customers whose invoices you want to factor will be notified. A letter will inform the customers whose payments you assign, that your company has recently established a line of credit with Fuller Business Funding. Henceforth, any and all payments owed to your company, should be sent to us.
3. To sell an invoice, you simply fax us a copy, along with a signed statement listing the invoices you wish to sell. Within one or two business days, we electronically deposit the bulk of the invoice amount directly into your bank account.
In essence, our advance to you functions like a large down payment on the sale of the invoice. For example, an 80% advance on a $1,000 invoice would be $800. However, the sale price of the invoice can’t be determined until your customer pays. Once we receive the $1,000 payment, the accrued discount can be calculated. For example, if the discount per day was $1, after 50 days the accrued discount would be $50. To determine what portion of the payment belongs to us, we add the $50 discount to our $800 advance = $850. Then, we subtract $850 from $1,000 = $150. This remainder belongs to you. Like the advance, we electronically transfer the rebate into your bank account.
To find out if you qualify or to apply, call us today at 541-484-7044.
|
