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Getting paid: your three options, compared
You've delivered the load. Now how does the money reach you? There are three main ways. None is "right" for everyone, and factoring is optional.
Disclosure: this page doesn't link to any factoring company yet. In the future, some companies may pay us a referral fee if you sign up through our links. Any such link will be marked "Paid link" next to it, and it will never change the comparison.
| Standard broker terms | Broker quick pay | Freight factoring | |
|---|---|---|---|
| How it works | You invoice the broker and wait. | The broker pays you early in exchange for a fee taken from the invoice. | You sell the invoice to a factoring company. It pays you most of it now and collects from the broker. |
| Speed | Often 30+ days. Varies by broker. | Usually days. Varies by broker. | Often same or next business day once paperwork is accepted. |
| Cost | No fee, but you carry the wait. | A percentage of each invoice you choose to quick-pay. | A percentage of each invoice, plus any extra fees in the contract. |
| Commitment | None. | Load by load. | Often a contract. Check the length, minimums and how you exit. |
| Best for | Carriers with a cash cushion. | Occasional cash needs with brokers you trust. | New carriers who need steady cash flow for fuel and insurance, and who want credit checks on brokers. |
Before you sign a factoring contract: 10 questions
- What's the all-in rate? Ask for the percentage and every other fee: ACH, wire, invoice processing, monthly minimum, and so on.
- Recourse or non-recourse? With recourse, you owe the money back if the broker doesn't pay. With "non-recourse", ask exactly what's covered; it's often only broker bankruptcy.
- Advance and reserve. How much is paid up front, and when is the held-back reserve released?
- Contract length and exit. How long is the term? Does it auto-renew? How much notice do you have to give, and is there a termination fee?
- Do you have to factor every load? Or can you choose which invoices to factor?
- Monthly minimums. Is there a fee if you factor less than a set amount?
- Release when you leave. How fast will they send release letters to your brokers and clear any lien (UCC filing)?
- Broker credit checks. Can you check a broker before you book the load, and is that free?
- Fuel advances and extras. Are there fuel cards or advances? What's the real cost of each?
- Paperwork cutoffs. What time do you need to submit the BOL and rate confirmation to be paid the same day?
Get the answers in writing, and read the actual contract, not just the sales sheet.
What would factoring cost you?
Put a real quote into the calculator. For a deeper walk-through with a worked example, read what freight factoring really costs a new carrier.
Factoring cost calculator
See what a factoring quote really costs. Your inputs stay in your browser.
The yearly-rate figure is a simple comparison, not an official APR: the fee as a share of the invoice × 365 ÷ the days you'd otherwise wait. It shows why factoring is a cash-flow tool, not cheap money. The monthly fee figure ignores any reserve the factor holds back, which you get later.
Not sure which fits? Email us your situation (trucks, lanes, how fast you need cash), and we'll reply with a plain comparison. It's free, and you don't have to pick anyone.
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