5 Questions for Factoring Companies

Factoring companies will oftentimes quote a business an amazingly low rate to grab their interest, but fail to mention that their “amazing” rate goes up over time, sometimes in as little as 7 days. This means that the quoted rate and the rate the business actually pays are often quite different. If the soonest you can collect on an invoice is 30 days, your actual rate becomes much higher than what you thought you were getting.

Integrity Factoring offers its Transportation clients a simple low flat rate that doesn’t go up.

Many factoring companies are happy to tell you whatever you want to hear to sign you up – because they know their contract terms make it very hard and expensive if you ever want to leave. Long, lock-in terms and early termination fees, sometimes thousands of dollars worth, can keep a business trapped in a bad factoring relationship. Also, the sweetheart deal that got you to sign up might not last your entire contract term, making it almost as costly to stay as leave.

Integrity Factoring’s contract term is month-to-month, freeing your business from the burden of long, lock-in contracts.

A monthly minimum (sometimes referred to as a minimum volume) is a fixed dollar amount that your company must contractually factor each month. Usually, there are hefty penalties levied against a company who fails to factor their minimum volume. Minimums can be especially burdensome for new or seasonal businesses as it can be difficult to predict work volume month-to-month.

Integrity Factoring does not require monthly minimums.

Providing a business with cash is the sole purpose of a factoring company. So, if a factoring company places a fee on every possible form of payment, what they are actually doing is building in a hidden cost that raises your factoring rate without making it obvious. For example, if you are charged $10 for an ACH deposit on a $1,000 invoice, your rate just instantly went up 1%.

ACH deposits are always free at Integrity Factoring.

Much like the last question, this question is an attempt to figure out if your factoring company has a slate of hidden fees secretly driving up your rate. Fees for optional or additional services are one thing. If your factoring company adds extra fees to essential factoring services, however, then what they are really doing is hiding a higher rate behind smoke and mirrors.

In addition to no invoicing or processing fees, Integrity Factoring does not charge termination fees, application fees, set-up fees, monthly maintenance fees, or any other hidden fees that other factoring companies nickel and dime their clients with.