Factoring Agreement Document With Recourse In Riverside

State:
Multi-State
County:
Riverside
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

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.

How to Record Invoice Factoring Transactions With Recourse Record a credit in accounts receivable for the sold invoice in the amount of $375,000. In the recourse liability column, record a credit after estimating the bad debts and any other possible losses ($750).

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)

How to Record Invoice Factoring Transactions With Recourse Record a credit in accounts receivable for the sold invoice in the amount of $375,000. In the recourse liability column, record a credit after estimating the bad debts and any other possible losses ($750).

More info

To learn more about how invoice factoring can help you, fill out a form online for a free consultation with Riviera Finance today. You'll receive a factoring agreement when your request is approved.STEP 3: The Factoring Company Verifies the Invoice. Let's break down the key things you need to know about invoice factoring contracts. ‍. Sample Business Contracts. Factoring is when a company sells its accounts receivable to another company in exchange for cash in advance of the accounts receivable payment due date. Recourse factoring entails assuming the responsibility for unpaid invoices, while non-recourse factoring transfers the credit risk to the factoring company. Recourse factoring is the most commonly used form of factoring found today. Contract is for non-recourse factoring. Security Agreement (the "Assignment Agreement") with Riverside Merchant Partners, LLC ("Riverside", or "Holder"), Hercules.

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Factoring Agreement Document With Recourse In Riverside