Factoring Agreement Meaning With Example In Houston

• Category: Contracts - Factoring
• State: Multi-State
• City: Houston
• Control #: US-00037DR
• Format: Word; Rich Text

Description

A factoring agreement, as exemplified in Houston, is a financial arrangement where a business (the Client) sells its accounts receivable to a third party (the Factor) in exchange for immediate cash. This allows the Client to access funds quickly for operational needs while shifting the risk of collecting payments from customers to the Factor. Key features of this agreement include the assignment of accounts receivable, the right of the Factor to collect payments directly, and the terms of credit approval and risk assumption. Filling out this form requires details about both parties and the specifics of the accounts being factored. Legal professionals such as attorneys, partners, and paralegals benefit from this form as it formalizes the financial arrangement, ensuring compliance with state laws and protecting the interests of both parties involved in the transaction. The clear structure of the agreement aids users in understanding obligations and rights, making it a useful contract for those in need of immediate liquidity without incurring additional debt.