A Guide To Invoice Factoring in Arizona

Arizona has a large economy that’s home to many thriving businesses. In fact, according to research, the state ranked first for economic performance — meaning the Copper State is a great place to build a company.

But starting and meeting your business needs requires capital. That’s where invoice factoring comes in. Whether you’re a new business owner or have an established company, keep reading to discover how to use invoice financing to manage your cash flow and run a successful business.

Why Use Invoice Factoring?

Invoice factoring allows small business owners to borrow capital using their accounts receivable as collateral. This type of business loan is also called accounts receivable financing. It can be a good option for entrepreneurs with bad credit scores.

With this type of loan, you’re selling your outstanding invoices to cover operating expenses, such as inventory, rent and utilities, and salaries and wages. To assess your risk, the factoring company looks at the customer’s credit rating, meaning there’s no personal credit requirement for the business owner (you).

Invoice factoring can be an alternative funding option if you don’t qualify for traditional loans. For instance, if you have a new business or startup, you may not qualify for bank financing because you don’t meet certain requirements, like a certain amount of time in business or years of experience.

If you’re a business owner who doesn’t have time for invoicing and chasing customers for payments, factoring might offer a solution for you. You get your money upfront, and the factoring company can take over your collections.

Factoring services can offer a quick and easy funding solution to Arizona businesses. Many invoice factoring companies even have same-day approval so that you can receive funding faster.

What Types of Arizona Businesses Use Invoice Factoring?

Business owners who sell goods or provide services to other businesses on credit can use invoice factoring. Instead of waiting for customers to pay, Arizona factoring companies take over the management of unpaid invoices, and the business receives the cash upfront.

For example, the health care, transportation, construction, and manufacturing industries use invoice factoring to manage their cash flows.

For example, many trucking companies use invoice factoring to cover costs since they typically have extended payment terms. Trucking companies must usually deliver goods to customers first to get paid, and they may not get paid until 30 days later.

The same scenario applies to staffing agencies, wholesalers, and contractors — they may use invoice factoring to avoid cash flow problems, ensuring there isn’t a gap between when they need cash and when they receive payment.

Financing solutions like invoice factoring give businesses access to consistent cash flow to operate and provide great service.

What to Look for When Choosing an Arizona Invoice Factoring Company

When researching Arizona invoice factoring companies to work with, check their application process, factoring rates, and reviews. Look for a lender with a streamlined process for applications and approval.

The last thing you want is a factoring company that has you running around for documents and delaying your funding.

Make sure you’re asking the right questions regarding rates and terms. Factoring rates depend on the lender. Some lenders charge daily, weekly, or monthly interest rates and fees, while others may have a one-time, flat fee.

Before you sign, have a clear understanding of how the invoice factoring company calculates factoring fees, what the current rates and advance amounts are, and what the fee structure looks like.

Lastly, read reviews about the factoring company. See what their previous and current customers think about their services, policies, and how they communicate. Many legitimate lenders are out there, so you don’t have to settle with one that can’t provide good service.

If you don’t have the time to research factoring companies, let Clarify Capital do the bulk of the work for you. Simply fill out our online application — it takes just two minutes!

A Clarify adviser will reach out to you to help you choose the best factoring solution based on your business needs. We have a marketplace of more than 75 lenders, so you get the best rate.

Your dedicated adviser will guide you through the process to ensure you understand the terms of your invoice factoring contract. Our services come with a promise of convenience and transparency. Check out what our clients have to say about us.

How To Secure Invoice Factoring in Arizona in 4 Steps

As a business owner, you’re almost always in a time crunch. You don’t have time to look for that one errant document you need to receive your funding.

To help, here are a few tips on how to secure funding with invoice factoring.

1. Gather the Required Application Information

First, get all the required documents and information ready. Although requirements depend on the lender, most factoring companies will ask for the following:

  • Legal identification documents: This can include your driver’s license, passport, employer identification number (EIN), Social Security number (SSN).

  • Business identifying documents: This can include any business licenses, Articles of Organization, or Articles of Incorporation.

  • Tax returns: Not all invoice factoring companies ask for tax returns, but be prepared to show your most recent (at least two years) business and personal tax returns.

  • Accounts receivable aging report: Prepare a report detailing your current and most recent accounts receivable. Factoring companies have their own rules on how old the invoices need to be, although many accept unpaid invoices not older than 90 days. They will use this information to verify your customers and check their creditworthiness. Lenders also use the report to keep track of the amounts owed and payment due dates.

2. Choose an Invoice Factoring Company That Serves Arizona Businesses

Before researching lenders, know what rates you can afford and how much capital you need to borrow. This way, you can find a company that best suits your needs. You can then narrow down your options based on rates, fees, and how much cash they can advance you.

Look no further if you’re looking to get financing through invoice factoring with low rates and up to 100% of your invoice value. At Clarify Capital, you can fund up to the entire amount of your accounts receivable within 24 hours. There are also no credit checks, and we require minimal documentation.

3. Apply for Invoice Factoring

You gathered all your documents, calculated how much money you need and what rates you can afford, and now it’s time to apply. Working with Clarify Capital is quick and easy. Fill out our online application form or call us directly.

You’ll then get matched with a Clarify adviser who will walk you through the process and help you choose the best funding option based on your needs.

4. Receive the Invoice Factoring You Need

Invoice factoring is a fast and easy form of business financing, and one of the benefits is getting your funding quickly. You can get approved on the same day if you meet the lender’s requirements. You’ll then receive your funding within a day or two.

h2 Secure Invoice Factoring Now With Help From Clarify Capital

Get paid faster for goods and services you’ve already delivered! Invoice factoring may offer a better solution if you’re taking on debt to cover your day-to-day expenses while waiting for your customers to settle their accounts.

Whether your Arizona business is located in Phoenix, Tucson, Scottsdale, or anywhere in between, the right factoring company can help you grow your company. Imagine having a consistent cash flow to pay your operating expenses on time and take advantage of profitable opportunities.

Contact Clarify today to discuss securing funding through invoice factoring.

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