The Business should be free of tax liabilities.This means that the pre-billed invoices or invoices issued before the project completion will not be accepted. The invoices should already be issued.Once the factor finds out you're hiding something, you will hurt your chances of approval.Īside from having creditworthy customers, you'll also have to meet the following requirements: Is your client-facing debt or any other legal issues that might hinder them from paying their outstanding invoices when the net term is up?īe sure to answer these questions as truthfully as you can.Are your clients reputable? (Government contractors and large commercial businesses usually have a good track record of repayments).Does your customer operate in a high-risk industry (i.e., legal, construction, travel and hospitality, health services, etc.).Do your customers have a good credit rating?.Do they normally pay before or on the day the invoice is due?.To determine the credibility and reliability of your customers, the lenders may ask you to answer the following questions: Having creditworthy customers is the first requirement of no credit check invoice financing. Now that we've established that invoice financing with no credit check is possible, you might be wondering how you can qualify for one. If you're looking for an invoice factoring company that skips the credit check, it's best to inquire from the company directly if they perform credit checks or not before moving forward with your application. Basically, the credit background check will tell the lenders that you're able to meet your financial obligations each month, and therefore, indicate that you're working with responsible customers. This usually happens if it's your first time using the factoring company's services. Some invoice factoring companies may check both your business credit score and that of your client. That means if you want to get approved for invoice factoring or at least secure excellent terms for the financing, working with creditworthy clients would help. After all, the repayment for the cash they advanced to your business depends on your clients' repayment behaviors. They do, however, take your clients' credit histories and scores into consideration when assessing your eligibility for funding. When it comes to invoice factoring, lenders (at least most of them) aren't particular about your company's credit score. But it will still depend on the lender you work with. Invoice financing with no credit checks does exist. The business' clients should also be creditworthy to qualify for non-recourse invoice factoring. Because the risk is higher, only a few factoring companies offer non-recourse factoring. In case the business' client defaults on payment, the invoice factoring company will shoulder the losses. Once the lender takes hold of the invoices, the business won't have to deal with them again.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |