Oct 10, 2017 • Carriers

Freight Factoring Process

Freight Factoring Process

Here’s a step-by-step guide to better understand the freight factoring process and how it can be beneficial for your trucking company.

Freight Factoring Process

The freight factoring process might sound complicated and even overwhelming but it doesn’t have to be. It can be better understood by following our easy to follow guide, along with choosing a freight factoring company like InstaPay. that makes the process of getting paid easier than ever!

What is Freight Factoring?

Freight factoring is the process of selling accounts receivable (freight invoices) for a discounted price so owner operators don’t have to wait over a month to get paid. It’s a finance solution that allows your trucking company access to immediate funds without having to deal with banks, collateral or interest charges. It’s the best way to streamline your cash flow.

When you choose to factor your freight invoices, your credit score does not matter, nor does the size of your business. Freight factoring is based on your client and non-recourse freight factoring with InstaPay means you don’t have to worry about collecting from your clients either. To put it simply – send your docs and get paid immediately!

Overhead costs can pile up and put your trucking company at risk. Diesel fuel prices aren’t going down significantly anytime soon and if you have used trucks in your fleet, repairs can cut into any potential profit as well with costs upwards of $.15 cents per mile according to the American Transportation Research Institution.

If you want to know more about freight factoring in greater detail, check out our breakdown of the advantages of freight factoring.

Freight Factoring Step-by-Step Guide with InstaPay

1. Finish hauling your load

2. Take a picture of your Bill of Lading and Rate Confirmation and email them to InstaPay, right from your phone

3. Wait for a response with the factoring agreement from InstaPay

4. Agree to the terms (no minimum commitments or hidden fees)

5. Sign-up (if you haven’t already) and provide information for bank deposit

6. Get paid within a day and let InstaPay handle collections

It’s that easy! You (and your fleet of drivers) work hard and make tremendous sacrifices to ensure freight is delivered in a timely manner. Without your dedication, America couldn’t function the way it does now. It’s why you shouldn’t have to wait to get paid.

Try freight factoring with Trucker Path InstaPay and expand your business, hauling more freight.

[button text=”Sign Up For InstaPay” href=”https://www.getinstapay.com” width=”250px”]

TagsFreight Factoring

Fine Print and Hidden Costs in Freight Factoring [p]Be certain to review the fine print of freight contracts as sneaky freight factoring companies sometimes have hidden costs that are added to the advertised factoring rate. [/p] [h2] Freight Factoring - What some companies don't tell you [/h2] [p]Factoring can be a great tool to streamline your cash flow and grow your business as it eliminates the wait to get paid for owner-operators. However, some factoring companies have contracts with complicated jargon and disclaimers hidden in the fine print. [/p] [h2] Hidden Costs [/h2] [p]Sometimes a factoring company will advertise a great rate, far lower than any competitor. It's a perfect scenario for you, right? Well, not exactly. [/p] [p]Those rates that seem too good to be true are typically just that. Although a low rate is optimal, the associated fees that you will incur in addition to the rate can balloon the overall cost for you to factor. [/p] [video id="IBCMtru_QMQ"] [h2] ACH Transfer Fee [/h2] [p]ACH Transfer fees can be issued each time you factor and range from $10 to upwards of $25 depending on the type of transfer or deposit. This cost can surely add up over time and frankly, it's ridiculous for to you to pay a fee just to receive your money. [/p] [h2] Minimum Volume Fee [/h2] [p]Often times a factoring company will require you to commit to factoring a minimum volume of invoices. Failure to meet the agreed minimum amount can result in extra fees or a percentage surcharge. Take into account your typical invoice amounts and calculate if you will have an issue trying to meet the minimum requirements. Keep in mind not all factoring companies have this policy or fee. [/p] [h2] Client's Credit Check Fee [/h2] [p]Although your credit is not taken into account, your client's credit is. The creditworthiness of your client must meet a certain standard for certain factoring companies before they agree to factor your invoices. That's right, some companies will charge you a fee for that credit check. [/p] [h2] Length of Terms [/h2] [p]You might decide to factor for a variety of reasons. Unavoidable circumstances might arise making it difficult to cover your operational costs. Truck repairs are extremely costly and unpredictable at times, especially for owner-operators and having a reliable truck that is fully functional is essential to your business. If you run a small fleet, wages, insurance, and taxes further compound your expenses. [/p] [p]This brings the length of terms to factor into play. Most factoring companies offer three to six-month term agreements to factor with some even require one-year contracts. It's important that you review and consider your options when considering the length of terms.[/p] [p]Be sure to choose the best fit for you. If you're confident that you won't be factoring for an entire year or that you want to explore other options after a few months, you should consider factoring with a company that doesn't have a minimum length of terms agreement. [/p] [h2] Termination Fee [/h2] [p]Let's say you have been factoring with a company for six months now. You have received payment days after hauling a load and it's been beneficial in helping you generate cash quicker to cover your expenses. Now you have ample funds and decide that you don't need to factor for the next few months.[/p] [p]The factoring company won't let you out of the contract because you agreed to factor for a certain length of time. In order for you to stop factoring, you have to pay a fee up to $1,000. [/p] [p]That's ridiculous, right? [/p] [giphy] <iframe src="https://giphy.com/embed/KE58LJF3k8jug" width="480" height="426" frameBorder="0" class="giphy-embed" allowFullScreen></iframe><p><a href="https://giphy.com/gifs/roger-KE58LJF3k8jug"> [/giphy] [h2] Choosing a Freight Factoring Company [/h2] [p]Before choosing to do business with a factoring company, you should take into account these potential hidden costs and fees in the fine print of a contract. Freight Factoring helps manage your trucking company's cash flow and takes the hassle away from client collections, allowing you to focus on growing your business and hauling more freight. [/p] [p]You shouldn't feel that you are being fleeced by an unusual amount of fees that you weren't aware of or deal with. <strong>Trucker Path InstaPay</strong> is freight factoring that pays you in a day with no hidden costs, fees, minimum commitments or contracts with pages and pages of fine print to sift through. [/p] [button text="LEARN ABOUT INSTAPAY" href="https://truckerpath.com/sign-up-instapay/?utm_source=blog&utm_medium=hiddenfeesAug1" width="250px"]

Aug 01, 2017 • Carriers

Trucker Spotlight - Jake Clyde <em>The Trucker Spotlight series explores the lives of truckers and their journey to make a difference in their industry. We interview different truck drivers to understand some life lessons that make them who they are today. We also learn more about their motivations, and the problems that they encounter on the job. We also tackle how Trucker Path's solutions helped them with what they do. The information that they provide helps inform other people who are looking to delve into the trucking world.</em> <h2></h2> <a href="https://truckerpath.com/uploads/2020/06/IMG_94991.jpg"><img src="https://truckerpath.com/uploads/2020/06/IMG_94991-225x300.jpg" alt="" width="225" height="300" class="alignleft size-medium wp-image-5004" /></a> <h2></h2> Today we are putting the spotlight on <strong>Jake</strong>, who recently started a Youtube channel "PinoyTruckerInUSA" where he shares his experiences being an over-the-road Filipino truck driver. He mostly drives in the Midwest and has been trucking for 5 years. We are stoked to get him to share some insights regarding the trucking industry. <h2></h2> <h3></h3> <a href="https://truckerpath.com/uploads/2020/06/IMG_94901.jpg"><img src="https://truckerpath.com/uploads/2020/06/IMG_94901-225x300.jpg" alt="" width="225" height="300" class="alignleft size-medium wp-image-5010" /></a> <h2></h2> <h3><strong>What made you decide to be a trucker?</strong></h3> I've always been an adventurous person and I love to travel so when I found out about trucking, I thought it would be perfect for me. Because of trucking, I was able to live my life freely and help my loved ones. It truly is a job that I enjoy. <h2></h2> <h3><strong>How are you holding up with the COVID-19 situation?</strong></h3> A few of my current struggles include the lack of loads i’ve been getting which lowers my overall income. Aside from that, I have really put some effort in enforcing some safety measures for my own health and safety. <h2></h2> <h3><strong>Can you share some safety measures that you have been doing?</strong></h3> I protect my self by following the standards of social safety distancing, wear masks at all time, and I always wash my hand. I have my own protective gear too. I'm also lucky to have been provided free masks by some shippers. <h2></h2> <a href="https://truckerpath.com/uploads/2020/06/IMG_94921.jpg"><img src="https://truckerpath.com/uploads/2020/06/IMG_94921-300x225.jpg" alt="" width="300" height="225" class="alignleft size-medium wp-image-5001" /></a> <h2></h2> <h3><strong>What are the significant changes you've noticed in your 5 years of trucking?</strong></h3> Back in the day, trucking was complicated because of the lack of technology. But now, apps like <a href="https://truckerpath.com/">Trucker Path</a> helps so many truckers because it’s user friendly and easy. I’ve been using this app for some time now and I highly recommend it to truckers. It’s basically an all-in-one platform for truckers. <h2></h2> <h3><strong>What are the common troubles or problems that you have encountered while trucking?</strong></h3> A few troubles I’ve encountered are heavy traffic in the cities, road rage from other drivers, and the fact that some don’t let you pass at all. <h2></h2> <h2></h2> <a href="https://truckerpath.com/uploads/2020/06/IMG_94931.jpg"><img src="https://truckerpath.com/uploads/2020/06/IMG_94931-300x225.jpg" alt="" width="300" height="225" class="alignleft size-medium wp-image-5013" /></a> <h2></h2> <h3><strong>What are your usual routes? Favorite scenic truck route?</strong></h3> As a truck driver, i’ve been through a few amazing roads but my favorite is Oregon. The scenic views are mesmerizing. <h2></h2> <h3><strong>Any difficult routes for you?</strong></h3> Some unusual roads I’ve driven is probably in New Jersey and New York. When I first started solo driving, I've found the road too confusing and difficult. <h2></h2> <a href="https://truckerpath.com/uploads/2020/06/IMG_94891.jpg"><img src="https://truckerpath.com/uploads/2020/06/IMG_94891-225x300.jpg" alt="" width="225" height="300" class="alignleft size-medium wp-image-5007" /></a> <h2></h2> <h3><strong>Any tips for aspiring truck drivers out there?</strong></h3> I have 3 tips for aspiring truckers: Always think of your safety , pay attention, and slow down. <h2></h2> <h3><strong>Where can people watch your trucking videos on Youtube?</strong></h3> You can find me on my <a href="https://www.youtube.com/channel/UCxb1GZCJKAveF-ZF-BQkl4A">Youtube channel, "PinoyTruckerInUSA"</a>. <h2></h2> <iframe width="560" height="315" src="https://www.youtube.com/embed/gZwRqkBedFU" frameborder="0" allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe> <h2></h2> Cheers! <h2></h2> <h2></h2> <h4>By Aldous Aldwin</h4> <h3></h3> <h3></h3>

Jun 04, 2020 • Carriers

What is a Freight Agent? [p] Find out what is a freight agent and how they are different from freight brokers.[/p] [h2] What is a Freight Agent? [/h2] [p] A freight agent is an independent contractor who helps connect shippers with carriers willing to haul the freight. A freight agent works for a freight broker and plays a crucial role in the movement of freight, as a customer-facing salesperson of sorts who has to find available carriers to ship a client's freight. [/p] [h2] Freight Broker vs Freight Agent [/h2] [p] The difference between a freight broker vs freight agent is that a freight broker has a <a href="https://truckerpath.com/blog/freight-broker-license/">freight broker license</a> through the FMCSA and is liable for the transportation of the load. A freight agent does not require a license, does not assume the risk of client's creditworthiness in terms of invoice collections and does not require a freight broker bond. [/p] [h2] Freight Agent Salary [/h2] [p] A freight agent salary can be paid as hourly or annual salary and they can also earn a commission percentage based on the profit they are able to bring in for the freight broker. According to the national average freight agent salary is $58,661 (based on 197 freight agent employee reports). Some freight agent salaries are only commission based so there are endless possibilities for earnings. [/p] [p]Let's say that you're a freight agent and you work for a freight broker who is willing to pay you 50 percent commission on the profit of moving a truck load. You found a shipper who is willing to pay up to $2,500 to move a load from Los Angeles to Denver as truck freight. [/p] [p]Using a load board you found a qualified carrier that will move haul the freight for $2,000. The $500 difference is the profit earned for the brokerage and your cut of 50 percent of $500 is a commission payment of $250. It's no surprise to see that a freight agent can have tremendous earning opportunity. [/p] [p] If being a freight agent doesn't seem as lucrative, you can <a href="https://truckerpath.com/blog/how-to-become-a-freight-broker/">learn how to become a freight broker</a> and even start your own freight broker company. [/p] [h2] How Freight Agents Find Carriers [/h2] [button-green href="https://truckerpath.com/truckloads/broker-load-board/?utm_source=blog&utm_medium=freightagent&utm_campaign=aug23"]Try Truckloads for Free[/button-green] [video id="o_tsuJHWayo"] [p] The best way for a freight agent to find a carrier is by using load boards. Load boards provide freight agents with a marketplace where they can post their client's freight for potential carriers to agree to haul. [/p] [p] There is a certain level of trust a freight agent must have in a carrier they choose to do business with. Without the trust that a carrier is qualified to haul the load and will see the job through, a freight carrier puts the freight broker they are working for at risk and can lead to complications and the inability to earn. [/p] [h2] Importance of Networking and Negotiating for a Freight Agent [/h2] [p]From the use of load boards like Truckloads, freight agents can network with qualified carriers and work to develop trusted business relationships that last. Keep in mind that negotiations between the freight agent or broker and the carrier is a huge determinant of potential success. [/p] [p] Although you want to earn the maximum amount, you also need to consider the carrier's needs and the need for knowing when to do a little give-and-take will go a long way in establishing a rapport with carriers. At the end of the day, a freight agent can't make a living if they can't find willing carriers to haul the load. [/p]

Aug 23, 2017 • Brokers