Construction Subcontractor Invoice Factoring
Every construction subcontractor has financial obligations. But, growing your business proves tough without the cash flow necessary to accept larger contracts. When you’re waiting 30, 60, or even 90 days to be paid for a job, making payroll and paying suppliers can be nearly impossible. Unfortunately, this scenario is common in the construction industry. And, for a small or expanding subcontractor who doesn’t have enough cash reserves to float payroll or purchase equipment and supplies, it can slow business to a halt.
Factoring Solutions for Subcontractors
Given the situation, most subcontractors try applying for a line of credit through a bank. Oftentimes, however, getting a loan is not practical for a small or new construction subcontractor. A bank requires years of financial statements, and if approved, getting cash could take weeks or months. Therefore, bank loans aren’t typically an option.
Ready to Get Started?
Fill out the form below and one of our factoring experts will help you on your way!
Invoice Factoring for Construction & Subcontractors
So, how can construction subcontractors get funding without a loan? Construction subcontractor invoice factoring is the answer. Factoring for subcontractors provides cash within 24 hours. Immediate working capital enables both large construction companies and subcontractors to pay suppliers, purchase equipment, cover payroll and overhead expenses, and most importantly, grow their business.
What Could Your Business Do With More Money?
Find out today. 855-322-8671
Is Invoice Factoring Right for Your Construction Business?
Do you have to wait a long time for your invoices to get paid?
Are you struggling to pay your suppliers on time?
Are you not able to take advantage of supplier discounts due to slow-paying customers?
Have you ever had to hold off on paying your workers until you received a payment from a client?
Are you unable to grow your construction company because you don’t have enough cash to buy new equipment or hire new employees?
Could you benefit from faster payment for finished construction projects or quick funding for completed stages of a project?
Have you ever had to turn down a big job due to lack of working capital?
Is your cash flow affected by seasonal ups and downs?
Do you have bad credit that prevents you from qualifying for bank financing?
Are you a recent startup?
If you answered ‘yes’ to any of the questions above, then construction invoice factoring is an excellent financing option for your business. Contact us today to get more construction invoice factoring information.
How Construction Factoring Works:
- Create an invoice for a completed job.
- Sell construction invoices to a factoring company who will advance cash immediately.
- The construction factor will take it from there. They will handle the billing, collections, and account services, giving your construction company more time to take on new projects.
Criteria for Construction Companies to Qualify for Factoring Services
Factoring services can offer essential financial support for construction companies, but specific criteria must be met to qualify. Here’s what you need to know:
- Completion of Work: The company should ensure that projects are fully completed before seeking factoring services. Completion is typically recognized when the work is delivered or performed to the client’s satisfaction.
- Invoicing Structure: Only those companies that issue a single invoice for the entire project might be considered. The invoicing should reflect the total amount due for the completed work, rather than partial or segmented payments.
- Contract Terms: Contracts should not incorporate progress payments or contain any clauses for clawbacks. The financial terms need to be straightforward, ensuring clarity in payment upon project completion.
- Business Experience: Typically, a minimum of two years in business is required. This duration demonstrates established operational reliability and a track record of managing projects effectively.
These criteria help ensure that the factoring service can efficiently manage risk while providing financial assistance to the construction company.
You can’t afford to wait. Have cash in as little as a few days with invoice factoring for construction subcontractors. No minimum volume requirements or long term contracts are required.
