First Federal can provide unlimited funds for your business within 24 hours for one or all of your invoices. There is no need to wait for 30, 60, or 90 days to get paid on your invoices when we can give you cash immediately. Once you have delivered a product or performed a service for a creditworthy corporation or institution, contact us prior to sending your invoice to your customer. We base our credit decision on the strength of your customers, not YOU. We will confirm with your customer that the work has been completed or the goods delivered and accepted… we will then advance you up to 80% of the face value of the invoice amount directly wired to your account. When your customer pays us, you will receive the balance less our discount. And, we earn our fee only after we have collected payment on an invoice, not before.
We purchase receivables from both the commercial and government sectors. First Federal offers to large, medium and small business contracting firms (mechanical, electrical, plumbing, engineering, painters, steel fabricators, sheet metal workers, and more) a basis to improve their cash flow.
Example of How Funding Works
Let’s say a plumber wanted to factor a job where it was owed $100,000 on a single invoice for work, materials and services rendered. We would advance between $70,000-$80,000 on what is owed.
Or an electrical contractor could do work for a prime contractor, for a portion of the completed work. In this instance, the subcontractor will use us to increase their cash flow because the prime contractor is usually paying the sub every thirty to ninety days. In essence, the sub while providing the labor and services is using their cash flow to finance the prime contractors’ activities (Often, this lag on payments allows the prime contractor enough financing to get out and start more jobs)!
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First Federal provides timely aging reports so the contractor knows the status of all funded accounts.
First Federal provides professional accounts receivable bookkeeping and collection services on the funded accounts.
First Federal does not require long-term contracts.
Keep in mind that this is not borrowing money. It’s not even about making monthly payments. It enables a business to receive funds with 24 hours (after initial account is set-up). Cash flow gets controlled by a determination of how much to factor. The business owner can spend more time focused on growing and expanding the operation, providing better services for customers, instead of getting distracted and embroiled with collection issues.
Contractor Financing FAQs
What is First Federal’s factoring? How does it work?
It is the purchase of accounts receivable for immediate cash. Once you have delivered a product or performed a service for a creditworthy corporation or institution, contact us prior to sending your invoice to your customer. We will confirm with your customer that the work has been completed or the goods delivered and accepted, we will advance you up to 80% of the face value of the invoice amount in cash.
Do I need accounts receivable financing?
Yes…if you are a new business. YES…if you are a business that can’t get traditional financing, such as a small or medium size business or a minority or woman owned business. YES…if you need additional operating capital. YES…if you want to solve your cash flow problems.
How do I qualify?
We base our credit decision on the strength of your customers, not you. It’s easy to qualify if you meet the following criteria: Your customer must be another (creditworthy) corporation or institution. Your invoice must be a valid one for goods sold and delivered or services rendered…to your customer’s satisfaction. We will verify each invoice with your customer.
What does it cost?
The discount fee are determined by the number of days that elapse from the day we advance funds to you until the day we are paid back by your customer. And, we earn our fee only after we have collected payment on an invoice– not before.
How will I know which invoices are paid and which are not?
You will have your own account executive at our office, who you can call at any time for updated information. Just request an “Aging Schedule” which will show you which invoices have been paid and which remain open.
How fast can I get money?
In many states it takes as little as one week (or less) to get on-line. Once on-line, we can fund your invoices within 24 hours (once we receive verification of your invoices).
How do I get started?
Fax your Accounts Receivable Aging Schedule as well as a customer list with addresses and phone numbers to (301) 576-5348. Once we analyze your receivables and express an interest in proceeding with your funding, we will need you to fill out a 2-page application . Just call us and we will run it. It’s that simple!
