Factoring guide
Can you factor only some of your customers?
The short answer
Yes. With Smart Freight Funding you choose which customers to factor, customer by customer. Once you factor a load for a customer, all of that customer's loads are factored with us until you ask for an NOA release, and the customers you do not factor you keep invoicing yourself.
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How it works
Some factoring agreements require you to factor every invoice you have, sometimes called full turnover. Smart Freight Funding does not. You pick the customers.
- Choose a customer and factor their first load with us. They receive a notice of assignment.
- From then on, that customer's loads are factored with us and they pay us.
- Every other customer stays exactly as it was: you invoice them and they pay you.
Why it is customer by customer, not load by load
The notice of assignment tells a customer to pay us for your invoices. If you factored one of their loads and billed the next one yourself, their accounts payable team would be paying two parties for the same carrier, and payments would go to the wrong place. Deciding by customer keeps every customer's instructions simple.
Which customers carriers usually factor
Most carriers factor the customers who pay slowly and handle the fast payers in house. A broker who pays in 45 days is the one worth factoring; a shipper who pays in 10 may not be.
Whichever you choose, the customer has to be approved first. We credit check the customer who owes the invoice, and you can check the approved shipper list before you book.
Moving a customer back
If you want to bill a factored customer yourself again, ask us for an NOA release for that customer. There is no contract term to wait out and no fee for changing your mind.
Common questions
Is there a minimum if I only factor one customer?
No. There is no monthly minimum, no minimum load count and no minimum dollar volume, so factoring one customer costs nothing extra.
Can I add a customer later?
Yes, once they are approved. Send us the customer's name and we will check their credit before you factor their loads.
Can I factor just one load for a customer?
Factoring is decided by customer. The first load you factor for a customer brings all of their loads to us until you ask for an NOA release.
Plain terms, in writing.
No contract, no monthly minimum, and you choose which customers to factor. The application takes a few minutes.