No jargon. No fine print. Just a clear explanation of how factoring works and whether it's right for your operation.
You've probably heard the term "freight factoring" thrown around in trucking circles. Maybe a fellow owner-operator mentioned it at a truck stop. Maybe you've seen it in an ad. Maybe you've wondered what it actually is and whether it could help you. Lets get into it.
What Is Freight Factoring?
Freight factoring is a financial arrangement in which a trucking company sells its unpaid invoices to a factoring company in exchange for immediate cash.
Instead of waiting 30, 60, or 90 days for a broker or shipper to pay your invoice, you sell that invoice to a factoring company — like Single Point Capital — and receive the majority of its value, usually within 24 hours.
The factoring company then collects the payment directly from your broker or shipper when it comes due.
Let's Walk Through a Real Example
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STEP |
WHAT HAPPENS |
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1 |
You haul a load from Dallas to Memphis and deliver on time. Great run. |
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2 |
You submit a $2,400 invoice to the broker — it's payable Net 30. |
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3 |
Instead of waiting a month, you submit the invoice to Single Point Capital. |
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4 |
Within 24 hours, Single Point Capital advances you the invoice — that's in your account today. |
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5 |
30 days later, the broker pays the invoice in full and Single Point Capital collects. |
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6 |
Your paid quicker and Single Point Capital handled all the invoiceing and collections. |
Key Terms You Should Know
- Advance Rate: The percentage of your invoice that the factoring company pays upfront. Single Point Capital advances up to 100%.
- Factoring Fee: The cost of the service, usually expressed as a percentage of the invoice. This is not interest — it's a flat transaction fee.
- Recourse vs. Non-Recourse: Recourse factoring means if your client doesn't pay, you owe the money back. Non-recourse means the factoring company absorbs the loss. Ask about this before you sign.
- Reserve: The remaining balance held back until your client pays. Once collected, the reserve minus fees is returned to you.
- Notice of Assignment (NOA): A formal notice to your broker or shipper that their invoice has been assigned to the factoring company and payment should go directly to them.
Is Factoring Right for You?
Freight factoring tends to be a strong fit if:
- You invoice brokers or shippers and wait 3-90days to be paid
- You're spending time chasing payments instead of hauling loads
- You want to take on more loads but don't have the working capital to cover costs in advance
- You're a new carrier without the credit history banks require
- You want predictable cash flow without taking on debt
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I've had nothing but a positive experience with Single Point Capital as my factoring company. Their services are efficient, and the team is incredibly responsive and helpful. They made the process easy and provided it quickly. I highly recommend them to businesses seeking reliable factoring solutions.
— Kristin, Owner-Operator, 1 truck | Single Point Capital Client |
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READY TO GET PAID IN 24 HOURS INSTEAD OF 30 DAYS? No debt. No long contracts. Just fast cash on loads you've already hauled. |
About Single Point Capital
Single Point Capital is a specialized trucking finance company providing freight factoring, fuel advances, and working capital solutions to owner-operators and small fleets across North America. We believe every carrier deserves fast, fair, and flexible access to the revenue they have already earned.