Debtor Finance - How it Works

Debt Factoring, Debtor Finance, Invoice Discounting, Cash Flow
Financing are all descriptions of the same type of business financial
service.

The essential element is that you sell your accounts receivable
(i.e. your invoices) to a financier at a discount.

The amount of the discount represents the charge by a financier on
providing the money to you e.g. this might be regarded as an interest
charge for the provision of funds.

The financier pays you now and collects the money directly from the
person or company that owes it to you in full at a later time.

If you provide the factoring request to us by 2.00pm, Woodsman
Funding will have the payment in your bank the next morning.

Depending on the industry in which you work, Woodsman Funding will usually advance between 80% and 100% of the invoiced amount less
the discount amount. The amount of the usual advance is agreed
between us when we set up the funding arrangements. If the advance
is less than 100% then Woodsman Funding provides the remainder of
the amount to you with 48 hours of receipt from the person or company
that pays the invoice.

Is factoring for you?


Factoring has several advantages:

- the cash provided via factoring expands and contracts with your sales.
  As you send the invoices off, you have immediate cash flow. This is
  better than an overdraft facility which can be stretched if you have an   
  increase in business;

- Woodsman Funding will chase money owed saving you the time
  and trouble of doing it yourself;

- factoring does not rely on equity in real estate.


Loans

Woodsman Funding will provide loans to businesses to assist
cashflow for periods of up to six months.

You might need to refinance an existing overdraft or need to pay for
business growth. There are all sorts of reasons why good businesses
need funding.

Woodsman Funding will require equity in real estate to be available to
secure the borrowing. As a general rule, we will advance up to 80%
of the value of the real estate with a first or second mortgage security.

We see our loan funding as filling a short to medium term need so
you will need to have developed a plan to repay the loan within the
agreed time frame. We can help with this if required

 



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