Thanks again. I will look into that safer. I have booked with a couple companies that had A rating on truckstop but RTS would not approve. So that led me to wonder if truckstop' credit system was off a little, or maybe dated a bit.
I'm leased now, but exploring other options.
good Nonrecourse factoring
Discussion in 'Ask An Owner Operator' started by HopeOverMope, Dec 27, 2017.
Page 4 of 6


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Thanks 
Some people look at factoring as 45% and think that's not bad, when in reality it cost much more than that. 
I get it, that a credit line of 20k at (let's say) 8% APR would be enough for not having to factor (per single truck at least) and it will cost $1600 instead of 4K per year.Last edited: Dec 30, 2017

Love how all these truck drivers and owner operators can't do math
whoopNride Thanks this. 
Try to think about it in reverse...
Can I give you 100 today and in 30 days you give me 104?
Now repeat it every month....
Why would you ever do anything else?bigbyrc Thanks this. 
The factoring percent (3,4,5) is only for 30 days usually. After 30 some companies raise the rate per invoice also.
30 days=1 month x 12= the apr rate. Close approximation.bigbyrc Thanks this. 
I understand that. I just don't like to compare factoring charge to an APR. Technically, it is one time charge per invoice. It means you sell one invoice per 4%.
On the other hand, from a factoring company angle it is 48% per year (based on ScooterJones example). That's true. That's how much they regain on their working capital per year.
A capitol (with an o) is a building that houses a government's legislative branch.
A capital (with an a) money, but not only....
ha ha ha!Last edited: Dec 30, 2017
bigbyrc Thanks this. 
The math on 48% apr is correct, I know it sounds better and makes people feel better to say 4% but the math doesn’t lie.
I understand factoring if you are trucking along and something bad happens where you need cash now to keep from filing bankruptcy, but to use factoring as part of your overall business plan is not a sound plan.xsetra, HopeOverMope and gokiddogo Thank this. 
The term APR makes all the confusions and it should not be used.
For example:
When you sell a house, your real estate agent's commission of say 4% is not APR but a commission. One time event. There is not a time factor involved in the equation. Selling your invoice for 4% of its value is not dependent on time factor either.
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