Factoring Agreement Without Recourse In North Carolina

State:
Multi-State
Control #:
US-00037DR
Format:
Word; 
Rich Text
Instant download

Description

A factor is a person who sells goods for a commission. A factor takes possession of goods of another and usually sells them in his/her own name. A factor differs from a broker in that a broker normally doesn't take possession of the goods. A factor may be a financier who lends money in return for an assignment of accounts receivable (A/R) or other security.

Many times factoring is used when a manufacturing company has a large A/R on the books that would represent the entire profits for the company for the year. That particular A/R might not get paid prior to year end from a client that has no money. That means the manufacturing company will have no profit for the year unless they can figure out a way to collect the A/R.

This form is a generic example that may be referred to when preparing such a form for your particular state. It is for illustrative purposes only. Local laws should be consulted to determine any specific requirements for such a form in a particular jurisdiction.

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FAQ

Factoring without recourse means that the risk of accounts receivable being uncollectible transfers from the buyer to the seller. Basically, if an accounts receivable cannot be collected, the seller does not have to reimburse the buyer like they would if the factoring was “with recourse”.

Factoring without recourse means that the risk of accounts receivable being uncollectible transfers from the buyer to the seller. Basically, if an accounts receivable cannot be collected, the seller does not have to reimburse the buyer like they would if the factoring was “with recourse”.

With recourse factoring, the business is responsible. But with non-recourse factoring, the factoring company is responsible, although there may be some stipulations based on the terms of the agreement. Higher advance rates (i.e. amount of funding you receive upfront). Lower advance rates.

Documents you will have to provide: Factoring application. Articles of Association or registered Amendments to the Articles of Association of your company. Annual report for the previous financial year. Financial report (balance sheet andf profit/loss statement) for the current year (for 3, 6 or 9 months, respectively)

More info

Bankers Factoring is honored to fund Carolina businesses with our non-recourse invoice factoring and purchase order financing programs. Non-recourse factoring means the company assumes the credit risk if a customer doesn't pay for specified reasons.What is non-recourse freight factoring? It's when a factoring company gets you the cash you need, even if your customers fail to pay! Easy to understand non-recourse factoring agreements with a low factoring discount rate and factor fees. Factoring services are fast and safe business capital. In fact, many nonrecourse factoring agreements come with stipulations and only cover very specific situations. Non-recourse factoring, as the name suggests, is an invoice factoring program in which there is no timeframe for your invoice to be closed. In a nonrecourse factoring agreement, the factoring company assumes the credit risk for the invoices it purchases. Please fill out this field.

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Factoring Agreement Without Recourse In North Carolina