Invoice Factoring: Does Bad Credit Matter?

Your Business Can Qualify for Invoice Factoring…Even with Bad Credit

How Can Your Business Get Funding with Bad Credit?

If you’re considering invoice factoring to help your business’s cash flow, but are afraid of being turned down because of a poor credit score, your fears are over. Since your customers are the ones paying the invoice factoring companies, factors look at the credit-worthiness of them. Not your personal or company credit score.  Remember, when you choose to factor invoices to fund your business, the factor companies take over the billing and collection process.

What Does This Mean for Your Business?

If your business is a corporate entity or an LLC, its credit score is viewed as separate from yours. So if your credit score is really bad, it won’t affect whether your business qualifies for factoring.

Using Invoice Factoring to Grow Your Business

As your business grows and expands, so does the need for working capital. By factoring your outstanding invoices, you are given immediate cashflow without collecting debt that traditionally comes with loans.  You can utilize the funds to meet payroll, maintenance, inventory and other unforeseen expenses.  As long as you have invoices to factor, funding is available.

Benefits of Invoice Factoring vs. Traditional Bank Loans

  • Immediate cash flow without creating debt
  • Approval based on the credit of your client, NOT you
  • Quick approval time
  • Available for start-up companies

What is Best for Your Business?

Factoring invoices are such a good option for a startup business or other companies that haven’t had enough opportunity to build up or establish a good credit score. If your customers typically pay their bills in a timely manner, a factoring company is more likely to take you on as a client.

So there you have it – your credit score won’t affect your ability to factor. Invoice factoring gives you up to 90 percent of the value of your invoices upfront. Once the factoring company receives payment for the invoice(s), the remaining balance is forwarded to you, minus a small factoring fee.

cash flow factoring

If your business is sitting on open invoices and needs to improve working capital, invoice factoring is the answer – even if your credit rating is less than stellar.

We partner with a nationwide network of factor companies that specialize in many industries. Our invoice factoring specialists will identify your company’s needs and goals and connect you with an account manager.

For more information, call now or fill out a form below for your free factoring quote.