CAPITAL AND MORE GROUP INC.
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"Flexible Commercial Finance"
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Accounts Receivable Financing
Accounts Receivable Financing provides a line of credit to businesses that use their Accounts Receivable as collateral.
Our lenders can facilitate lines of credit from $250,000.00 to $50,000,000.00 plus to manufacturers, distributors, service companies and contractors. We will consider accounts receivable financing credit facilities under $250,000.00 on a case by case basis.
The main difference between Accounts Receivable Financing and Asset Based Financing is that generally with Accounts Receivable Financing, only accounts receivable (and in some cases inventory) are used as collateral. Machinery, equipment and real estate are not necessarily used as additional collateral for the loan or line of credit.
There is also a difference between Accounts Receivable Financing and Accounts Receivable Factoring. With Accounts Receivable Factoring, the receivables are actually sold to a Factor at a discount whereas with Accounts Receivable Financing, the receivables are not sold, rather, the lender sets an available line of credit secured by the total qualified accounts receivable which can be drawn against by the borrower.
One major advantage that we offer borrowers is that the vast majority of our private and non bank lenders are direct portfolio lenders. This means that they originate loans directly with their own funds or with discretionary funds committed to them by investors. They then hold the loans in their portfolio or on their balance sheet until maturity. They do not securitize the loans and sell them in the secondary market. This provides for maximum flexibility in customized deal structuring that is impossible with conventional lenders whose loans have to fit within a predefined box that will allow for their subsequent securitization and sale in the secondary market. We also have several direct portfolio lenders that can accommodate loans in excess of $50,000,000.00 without the need to syndicate.
Companies that can benefit from Accounts Receivable Financing are generally in difficult situations and cannot qualify for conventional bank financing. Accounts Receivable Financing is used as transitional financing. Companies that can benefit from Accounts Receivable Financing may be facing one or more of the following situations:
 An insufficient track record High amounts of accounts payable Operating losses Highly leveraged companies Companies experiencing rapid growth Delinquent taxes / tax liens Foreign account debtors Bankruptcy DIP financing Restricted by bank covenants Turnarounds/ workouts Bank debt refinancing Debt restructuring and re-capitalization Financial and strategic acquisitions/ LBO's |
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Copyright© 2003-2009 Capital And More Group Inc. All Rights Reserved
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