Factoring explained
What is factoring?
Get paid today for invoices due tomorrow.
Factoring is a simple way for businesses to get cash from their unpaid invoices. Instead of waiting 30, 60, or 90 days for a customer to pay, you sell the invoice to a factoring company like MyFactor LLC. We advance most of the invoice value to you right away, collect payment from your customer, and send you the remaining balance minus a small fee. It’s not a loan, so there’s no debt to repay.
How it works
Three simple steps
- 01
You deliver and invoice
You deliver the load or complete the work and send us the invoice.
- 02
We verify and advance
We verify it and advance most of the invoice value to your account.
- 03
Your customer pays us
When your customer pays us, we send you the remaining balance, minus our fee.
Not a loan
Cash without adding debt
A bank loan
- Is based on your credit
- Adds debt to your balance sheet
Factoring
- Is selling an invoice you’ve already earned
- Depends mainly on how reliably your customers pay
That’s why factoring works well for new businesses, growing companies, and anyone who can’t wait on slow payments.
Example
What factoring looks like on one load
Say a trucking company delivers a load and sends the invoice to a broker who pays in 45 days. With factoring, most of that invoice is advanced to the carrier up front. When the broker pays, the remaining balance is released, minus the factoring fee. Instead of waiting six weeks for the whole amount, the carrier has cash for fuel and the next load straight away.
- The invoice, sent to the broker
- payable in 45 days
- Advanced to the carrier
- most of the invoice, up front
- Released when the broker pays
- the balance, minus the fee
- Instead of waiting
- six weeks
An illustration of how factoring works, not a quote. Your advance and your fee depend on your invoices and who you haul for.
Who uses factoring
Factoring for growing industries
Transportation
Owner-operators, fleets, and carriers waiting on broker payments
Freight brokers
Brokerages paying carriers fast while shippers pay on terms
Staffing
Agencies covering weekly payroll while clients pay monthly
Construction
Contractors funding invoices and approved change orders
Healthcare
Clinics, home health, medical staffing and labs waiting on insurance payers
Manufacturing
Manufacturers funding the next production run while customers pay on terms
Wholesale and distribution
Distributors freeing up cash to reorder before customers pay
Oilfield services
Hauling, equipment rental, well services and field crews waiting on operators to pay
Security services
Guard, patrol, event security and alarm companies with weekly payroll
Janitorial and facilities
Cleaning, facility maintenance and landscaping companies with weekly payroll
Food and beverage
Distributors, caterers, co-packers and specialty food producers
Why us
With MyFactor, you’ll know
- Your rate upfront
- Where every invoice stands
- When you’ll get paid
Transparent factoring. No hidden fees. No gimmicks.