Factoring

[ihavetissues]

My example - As a truck driver I get paid $ 2,100.00 to deliver a load. Normally it takes 30 - 45 days waiting to get paid the full $ 2,100. If I use a factoring company I get paid immediately with no waiting. The catch is they charge me a one time 5 percent fee of $ 105.00 . What I need to know is : what is the interest or interest rate I am being charged for this one time service & will you Please include the formula ?!? - Thank You in Advance !!!!! - I am guessing 40 - 50 % interest rate ???

 

[Deleted member 4993]

My example - As a truck driver I get paid $ 2,100.00 to deliver a load. Normally it takes 30 - 45 days waiting to get paid the full $ 2,100. If I use a factoring company I get paid immediately with no waiting. The catch is they charge me a one time 5 percent fee of $ 105.00 . What I need to know is : what is the interest or interest rate I am being charged for this one time service & will you Please include the formula ?!? - Thank You in Advance !!!!! - I am guessing 40 - 50 % interest rate ???

You are correct - within range.

.05/30*360 = ? [assuming you got paid after 30 days]

.05/45*360 = ? [assuming you got paid after 45 days]

 

[ihavetissues]

Thank you !!