What is invoice factoring?
Invoice factoring lets you sell your outstanding B2B invoices to a factoring company at a small discount in exchange for immediate cash. You receive 80–95% of the invoice value up front, your customer pays the factor on their normal terms, and you receive the remaining balance minus a fee.
Because the factor is underwriting your customers rather than your company, invoice factoring is available to businesses that cannot qualify for traditional loans — including startups, companies with tax liens, and owners with poor credit.
HL Hunt Funding arranges factoring facilities from $1,000 to $5,000,000 for trucking, staffing, manufacturing, distribution, construction subcontracting, and government contracting. Spot factoring (single invoices) and full-ledger facilities are both available.
How invoice factoring works
- 1Submit invoices
Share your open invoices and customer list. Approval is based on your customers’ payment history.
- 2Get advanced
Receive 80–95% of invoice value within 24–48 hours of setup.
- 3Customer pays
Your customer pays the factor on their normal terms — 30, 60, or 90 days.
- 4Receive the rest
The remaining balance, less the factoring fee, is released to you.
Best for
- B2B companies with slow-paying customers
- Trucking and logistics
- Staffing agencies
- Manufacturers and wholesalers
- Government contractors
Pros and cons
Advantages
- Approval based on customer credit, not yours
- Funding grows automatically with sales
- No debt added to your balance sheet
- Outsourced collections on some programs
Considerations
- Only works for B2B or B2G invoices
- Fees add up on slow-paying customers
- Customers may be notified of the arrangement
Requirements to qualify
- B2B or government invoices
- Creditworthy customers
- Invoices free of liens
- No minimum time in business for spot factoring
Requirements vary by funder. The fastest way to know exactly where you stand is to pre-qualify in two minutes — it is free and there is no credit inquiry.