Freight Factoring for Trucking Companies

Freight factoring is essential for trucking cash flow. Here's how it works:

The Basics:

1. ●Deliver a load
2. ●Submit BOL and invoice to factor
3. ●Receive 90-97% within hours
4. ●Factor collects from broker/shipper
5. ●Receive remaining balance minus fee

Why Trucking Factoring is Different:

• ●Highest advance rates in any industry (90-97%)
• ●Same-day or next-day funding
• ●Fuel advance programs
• ●Load board integrations
• ●Credit checks on brokers

Factoring Fees:

• ●Flat fee: 1.5-5% per invoice
• ●Or tiered: 2% first 30 days + 0.5% per 10 days after
• ●Fuel advance fees: 2-3%

Types of Factoring:

Recourse:

• ●You're responsible if broker doesn't pay
• ●Lower fees (1.5-3%)
• ●More common

Non-Recourse:

• ●Factor assumes risk of non-payment
• ●Higher fees (3-5%)
• ●Limited protection (typically fraud only)

What to Look for in a Factor:

• ●No long-term contracts (or low minimums)
• ●High advance rate (95%+)
• ●Fuel advance program
• ●Good broker credit checking
• ●Quick funding (same-day)
• ●Reasonable fees

Fuel Advance Programs: Many factors offer fuel advances:

• ●Get 40-50% of load value at pickup
• ●Loaded on fuel card
• ●Deducted from final payment
• ●Keeps trucks moving