Invoice Factoring

The Focus of this Article is on Future Invoice Factoring for aka

Merchant Service Loans for Securing Business Loans.

While future invoice factoring or Merchant Service Loans are a solution to borrow short term funds, it has a downside when comparing it to unsecured business loans. Invoice factoring is merely selling your invoices at a discount to what they are worth in order to raise capital for your business. When compared to an unsecured loan the downside is that you are securing the loan with your invoices. In most cases, you are actually selling existing and future orders at a discount. A problem can arise if the invoices that you sell do not have enough mark-up on the product or service. In such a case for example, if you sell your invoices for a 25% discount, but your markup was only 10%, you can lose that 15% overnight, making your annual loss for your product or services astronomical. Also, selling invoices has very little to do with your credit and everything to do with you clients credit scores. So the bank of factoring company that buys your receivable is going to contact you clients to make sure that they have good credit. This can sometimes lead to your clients to believe that you are having trouble and flee as an account. That is counterproductive because you want the capital to expand, not contract. However, with an unsecured business loan, it’s discreet between you and the lender; your clients never have to get wind of it. Also, you may only pay prime interest or close to prime interest rates to borrow the money if your credit qualifies. In the end, an unsecured business loan will save you a ship load of cash that you can put to better use expanding you growing company discreetly.

Another reason why you should use Accommodative Financial Solutions to help you gain access to Business Loans, as we are ranked #1 in America for our success in Unsecured Business Loan Research and Consulting!