Are you tired of receiving late payments for the clients that your drivers deliver cargo to? You can actually get paid before your customers pay for their shipments. All you have to do is contact a freight factoring company to get a loan that is based on what your customers owe. Take a look at this article to learn more about freight factoring so you will know if it is right for your business or not.
What is the Freight Factoring Process Like?
Basically, you will have to complete delivering shipments to your customers before you can go through with the freight factoring loan process. Once you have billed the customers, you will have what is necessary to apply for a loan. The freight factoring company will verify that the bills are legit and decide if they want to approve your request for advance money. The best thing about freight factoring loans is that the money can be in your bank account in a short period of time. For instance, some of the companies can deposit the money in as little as a day, but it varies between companies.
Will a Fee Have to Be Paid for the Service?
You must be prepared to pay a fee for the money that you are advanced from your freight bills. It is common for the lenders to charge a certain percentage that is based on the overall balance of the bills. The fee is necessary because it is how the freight factoring companies are able to make a profit. However, you will still be able to keep the majority of the money once your customers actually pay the bills.
Will a Specific Volume of Fright Be Required?
The good thing about dealing with a freight factoring lender is that there are usually no specific volume requirements. You can choose to receive money for a single freight bill if you desire to do so. You also have the option of receiving advanced money on a regular basis, which can come in handy if your company is in a financial bind.
Are There Any Other Services Provided?
There are many other services that are offered through fright factoring loan companies, but it depends on which one you choose. For example, some of the companies are able to run credit checks on the customers that you do business with. You might also be able to obtain fuel discount cards for your drivers if you sign a contract with a freight factoring company.