Being an auto hauler can be tough if your customers aren’t paying you for up to 60 days. Auto hauling has quite a few upfront costs – you haul the vehicles and pay the gas and other expenses well before you get paid.
Freight Factoring Auto Haul Bills FAQ
A freight factoring company can provide your auto transportation business with immediate cash for your freight bills. The trucking industry and factoring is not a new concept. If you have questions about freight factoring for auto-haulers, you can find your answers here. Can’t find your question and answer? Give us a call and we can help.
The responsibility of auto haulers also known as car haulers is to transport automobiles from one location to another. It is exactly how it sounds. This requires a specialized trailer on a semi-truck.
Freight factoring, also known as truck factoring, is the process of selling your outstanding invoices to an invoice factoring company for immediate cash. It’s a simple and effective way to improve your auto transport company’s cash flow. A Trucking company depends on truck factoring to keep business moving.
Once your car hauling company is approved for freight factoring, the process is as follows:
1. Deliver the load to your customers.
2. Once the shipment is received by your client, you will fax the auto transport bill to the factoring company.
3. Within a 24-hour period, the factoring company will advance you up to 95%, the rest will be held in reserve.
4. Your client will then pay the freight bill in full to the factoring company directly. Once the payment has been received, the remaining amount will be released to your auto hauling company, minus a factoring fee.
A freight factoring company can provide your auto transportation business with immediate cash to haul more loads. In the auto transport industry, customers typically pay after the job is complete. The customer also can take up to 60 days to pay their bill.
Freight factoring is beneficial for an auto transport company because it gives you immediate cash to keep your business going. Use the working capital to take out more auto loads, pay employees, pay for fuel, repairs and any other expenses.
It’s fast and easy approval, no hidden costs and no long-term contracts. Freight factoring for auto haulers also provides fuel advances and fuel cards, free credit checks, load board access, and other administrative services to your auto transport company free of charge.
No, as the owner of the auto transport company your credit score does not matter. The factoring company checks the creditworthiness of the customer. You don’t have to have great credit, but your customer does. However, if you have tax liens or
Freight factoring is a lot easier to qualify for than a bank loan. The most important factor when applying for freight factoring is the credit worthiness of the auto hauler’s customer. You should however inform the factoring company of any current liens or law suits. Factoring companies do not fund business that service customers directly. As long as you have unpaid invoices, a clean background and commercial or government customers, factoring is a great option for cash on hand.
No, freight factoring is not a loan. Freight factoring is basically unlocking the money sitting in unpaid receivables so it leaves you with no debt to pay. It’s fast approval and unlike a loan, it is not based on your personal credit score.
Independent auto haulers are still eligible for invoice factoring.
It doesn’t matter if you are new to the auto transport industry. As long as you have completed a job and have outstanding invoices, you are eligible for freight factoring.
No, you’re not locked into a long-term contract. Factoring for trucking is flexible and does not require any lasting commitments.
There are a couple of ways that your rates can be set up: tiered or flat rate fees.
· Tiered rates could be 1% for the first 10 days, 2% for the next 10 days, 3% for the following 10 days, 4% for the next, etc.
· Flat rates could be 3% for 60 days.
Either option could work for you. If your clients pay fairy quickly a tiered rate might be best. If your customers don’t pay on time or irregularly, a flat rate fee might be the better choice.
Typically, it takes the factoring company 24 hours to process an application. If everything checks out and you are approved, you’ll get the funds the same day.
The money is typically deposited into your bank account through wire or ACH. Direct deposit and wire transfers give you immediate cash. You can also request the money goes to your fuel card account.
We can get you partnered with a freight factoring company that specializes in auto transport. We have a great relationship with a network of factoring companies waiting to help auto transport companies like yours.
Simply call us now or fill out an online form for a free quote. Once we determine a factoring company that is best suited for your needs, we will make an introduction either right then on the phone or through e-mail.
This hands-free concept is great for busy auto haulers that want the best rates but don’t know the time to do the heavy online research. Every auto-hauler has different needs and we understand that. Allow us to do the hard part for you.