If you are confused by factoring, you are not alone. Factoring is a method of obtaining financing against commercial accounts receivable.
Companies of all sizes use factoring every day to finance their business operations.
Unlike traditional bank lines of credit, that focus on your credit score and profitability, factoring focuses on receivables from your customers and their ability to pay.
Where lines of credit may be denied to companies with high growth curves, factoring is a great option, based your customer base.
A large portion of our business is with companies that elect to factor for the first time. Companies with at least $1,000,000 in revenue
and $100,000 in outstanding receivables are a perfect fit for factoring.
Factoring Converts Accounts Receivable into Immediate Cash
In the factoring process you are, in essence, selling
your receivables to Overnite Capital. Typically, your
company will receive 80-90% of the receivable, with
receipt of the remaining balance after the customer
has paid the invoice (less fees to Overnite Capital.)
The process is simple.
- Complete a short application form including financial information
- Provide a detailed accounts receivable and accounts payable aging
- Include corporate financials for the past two years
- Provide a customer list
- Give us an overview of your business
- Please include financial projections (if available)
- Include an example of an open invoice & related documentation
- A competitive proposal is prepared for qualified candidates in a timely manner
Once the information is provided, we will make an assessment of the type of financing that is
available to your company. Most clients use their discretion to factor a sufficient level of
accounts receivable to sustain profitable growth.
Is Factoring for You?