Invoice factoring: get paid on delivery, not on net-60
Sell your unpaid B2B and B2G invoices for 80% to 95% up front. Approval leans on your customers' credit, not your credit score. We refer you to the right factor. In most states, funding partners pay us when an account funds or activates; in California and Missouri they instead pay a fixed fee per inquiry, whether or not you are funded. Either way, you pay us nothing.
Invoice factoring, in 60 seconds
Invoice factoring is the sale of unpaid business invoices to a funding institution at a discount. A manufacturer ships an order, invoices the buyer on net-30 to net-90 terms, and sells that invoice instead of waiting. The factor advances 80% to 95% within days, collects from the buyer, then releases the reserve minus a fee of roughly 1% to 3.5% for each 30 days the invoice stays open. Because the factor is underwriting your customers rather than lending against your balance sheet, a shop with thin credit and strong buyers can qualify when a bank line will not.
Manufactor Finance is an independent business financing referral service. We do not lend, bank, or invest. We match manufacturers with funding partners. In most states, funding partners pay us when an account funds or activates; in California and Missouri they instead pay a fixed fee per inquiry, whether or not you are funded. Either way, you pay us nothing.
How a factoring facility actually runs
The mechanics matter more than the headline rate. Here is the cycle you will live in every week once you are set up.
1. Customer credit review
The factor grades your buyers and sets a credit limit per customer. Strong buyers raise your advance rate and lower your fee.
2. UCC filing and notice of assignment
A UCC-1 is filed on your receivables and your buyers are told to remit to a lockbox. Existing lenders may need to subordinate.
3. Submit invoices
You upload invoices with proof of delivery. Most facilities verify the invoice with the buyer before funding.
4. Advance funds
80% to 95% of face value hits your account, typically in 24 to 48 hours once the facility is live
5. Buyer pays the lockbox
Payment goes to the factor, not to you. Aging past the credit period is where costs climb.
6. Reserve release
The remaining 5% to 20% comes back to you, less the factoring fee for the days outstanding
What factoring costs on a real invoice
Two illustrations at the same 2% per 30 days, showing why days outstanding drive the bill more than the headline rate. These are examples, not quotes.
Buyer pays on time, day 30
- Invoice amount$120,000
- Advance (90%)$108,000
- Fee (2% × 1 period)$2,400
- Reserve released$9,600
Effective cost on the invoice: 2%
Buyer stretches to day 75
- Invoice amount$120,000
- Advance (90%)$108,000
- Fee (2% × 3 periods)$7,200
- Reserve released$4,800
Effective cost on the invoice: 6%. Slow buyers, not the rate sheet, are what make factoring expensive.
See current factoring rate and advance ranges or run your own invoice through the calculator.
Am I a fit?
10-second prequalifier
If most of these describe your shop, we can almost certainly place you into a program
US-based manufacturer
You produce goods in the United States
B2B or B2G customers
You invoice other businesses or government agencies — not consumers
$25K+ in monthly revenue
Or a confirmed purchase order that gets you there
Net-15 to net-90 terms
Your customers pay on invoice terms, not COD
Not sure? We'll tell you honestly — no fees to you either way.
The process from first call to funded
No 60-second miracle. Real steps, from your first message to the partner's decision.
- 1
Start the conversation
Day 0Send a request, call, or chat. No obligation.
- 2
We match
Day 0–1Our team reviews your request and looks for a funding partner that fits.
- 3
Partner contact
Partner's timelineIf a partner thinks they can help, a specialist from that partner contacts you to discuss next steps.
- 4
Secure application
Partner's timelineThe partner sends its own secure application.
- 5
Underwriting
Partner's timelineThe partner reviews your file.
- 6
Offer
Partner's timelineThe partner presents its offer, rate, terms, and total cost in writing.
- 7
Sign and fund
Partner's timelineIf you accept, you sign directly with the partner, and the partner funds it.
- 8
Back to work
OngoingBuild, ship, grow.
What makes a factoring file hard to place
- Consumer invoices. Factoring works on commercial and government receivables only.
- Progress billing or deposits on work that has not shipped. Most factors fund delivered, undisputed invoices.
- An existing UCC-1 on receivables that the incumbent lender will not subordinate.
- Unresolved federal or state tax liens that would intercept the proceeds.
- Heavy concentration in one buyer whose credit is already deteriorating.
- A history of quality disputes or short-shipping that makes verification fail.
Factoring versus the alternatives
Bank line of credit
Best: Cheapest money available if you qualify.
Tradeoff: Needs 2 or more years of profitable financials and a covenant package. Limits rarely grow as fast as your order book.
Asset-based lending
Best: Lower cost than factoring at scale, and it can include inventory and equipment.
Tradeoff: 3 to 8 weeks to close, field exams, and reporting requirements most small shops are not ready for.
Purchase order financing
Best: Funds the production you cannot self-fund, before an invoice exists.
Tradeoff: Higher cost and it is usually paired with factoring to take out the PO facility.
Merchant cash advance
Best: Fast and light on paperwork.
Tradeoff: Highest effective cost, and daily or weekly debits strain a shop already waiting on receivables.
Keep going
Manufacturer loans
Compare factoring with equipment, PO, working capital, ABL, and SBA structures
Read moreInvoice factoring rates
Advance rates, fee structures, and the variables that move your number
Read moreOur factoring program
Qualification detail, documents, and how we refer your inquiry
Read moreManufacturing financing
All 6 programs compared, so you can see where factoring fits
Read moreFactoring vs line of credit
Head-to-head on cost, speed, and qualification
Read morePurchase order financing
Fund the production first, then factor the invoice it creates
Read moreFull rate benchmark
Directional ranges across every program we refer, updated monthly
Read moreInvoice factoring FAQs
Invoice factoring is the sale of your unpaid B2B or B2G invoices to a funding institution at a discount. You deliver the goods, invoice the customer, and the factor advances 80% to 95% of the invoice within days instead of you waiting out net-30 to net-90 terms. When your customer pays, the factor releases the reserve minus its fee. It is a sale of receivables, not a loan, so it does not add debt to the balance sheet.
Directionally, 1% to 3.5% per 30 days that the invoice stays outstanding, with advance rates of 80% to 95%. The exact number is set by the funding institution and depends on your customers' credit, monthly volume, invoice size, concentration, and industry. Anyone quoting you a rate before seeing your file is guessing.
No. You are selling an asset you already own, the receivable. There is no fixed monthly payment and no term. That is why factoring approvals lean much more on your customers' ability to pay than on your own credit score or time in business.
With recourse factoring, you buy the invoice back if your customer never pays. With non-recourse, the factor absorbs the loss when the customer fails for a covered credit reason, such as insolvency. Non-recourse costs more and still does not cover disputes over quality, delivery, or short-shipping.
Usually yes, because most manufacturing factoring is notification-based: your customer is told to remit payment to the factor's lockbox. In manufacturing and B2B supply chains this is routine and rarely raises an eyebrow. Non-notification programs exist but require stronger financials.
3 to 10 days from first conversation to first funding is the realistic range. Setup includes a customer credit review, a UCC filing, and a notice of assignment to your buyers. Once you are set up, subsequent invoice batches typically fund in 24 to 48 hours.
Often yes. Spot factoring and selective programs let you fund single invoices or single customers, and they price higher than a whole-ledger program because the factor gets less volume and less diversification. Whole-ledger commitments buy you the best pricing.
Consumer invoices, progress billing on work not yet delivered, unresolved tax liens that would intercept proceeds, an existing UCC-1 that another lender will not subordinate, and buyers whose credit is already deteriorating. Several of these are fixable within 30 to 90 days.
Ready to keep production moving?
Start with a quick inquiry or a phone call. We'll tell you exactly what the right program requires. At no charge.
Apply. Fund. Deliver. No obligation.
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