Factoring Agreement Draft With Recourse In Washington

State:
Multi-State
Control #:
US-00037DR
Format:
Word; 
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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

The Most Common Invoice Factoring Requirements A factoring application. An accounts receivable aging report. A copy of your Articles of Incorporation. Invoices to factor. Credit-worthy clients. A business bank account. A tax ID number. A form of personal identification.

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).

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).

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.

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.

More info

Learn all about factoring agreements including widely used terms and clauses. Download real examples of factoring contracts.With recourse factoring, which tends to be more common, the business must repurchase any unpaid invoices after an agreed-upon time frame, often 90 to 120 days. Recourse factoring holds you responsible if your customer fails to pay, while non-recourse factoring offers protection against non-payment. This guide will navigate you through all the necessary details regarding securing factoring services within Washington, DC. In this guide we'll review the differences between Recourse and Non-Recourse Factoring so that you can choose which fits your company best. Recourse factoring is the most common and means that your company must buy back any invoices that the factoring company is unable to collect payment on. With recourse factoring, you're responsible for the debt if your customers don't pay. Universal Funding, based in Spokane, Washington, is a leading company in the realm of invoice factoring. Recourse factoring is the most common type of invoice factoring.

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Factoring Agreement Draft With Recourse In Washington