FACTOR KING® was established with a few simple goals in mind- combine "Old World Factoring" with "New Age Thinking". Our Mission to provide crucial funding to small and middle tier companies that may or may not have access to adequate bank financing is responsible for our success. Through our leverage of various technologies our systems and procedures provides fast and accurate factoring, simple order processing, and ease of use allowing our clients to focus on building their core business. Client growth is how we measure our own success. Become part of FACTOR KING® today!!

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Glossary

Factoring Terms

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FACTORING TERMS

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There are currently 12 Factoring Terms in this directory beginning with the letter D.
D
D/B/A
Abbreviation for "Doing Business As".
DBT
DBT or days beyond terms indicates how many days past the due date an invoice is late.
Debt Instrument
Future payment or series of payments, or a debt that one party owes to another party. Also known as income streams or cash flow instruments.
Debtor
The party that owes something and makes payment to a creditor.
Default
The omission or failure to perform or fulfill a legal duty, obligation, or promise (i.e. to pay a debt).
Delivery Evidence
Documentary proof that shipment of goods invoiced as sales has occurred.
Dilution
The amount of risk associated with collection of the accounts receivable including but not limited to returns, charge-backs, trade allowances, concentrations, slow pay, and bad debt.
Discount (or Discount Rate)
The percentage of the face amount of an invoice that a factor keeps or charges as its fee for factoring and other services. Also called the factor's fee.
Discount Factoring
Discount Factoring refers to an arrangement whereby a factor purchases an account(s) receivable from a business at a discount to the face value of that receivable. The factor earns a fee based on the number of days that the receivable remains unpaid, i.e., the longer the receivable remains unpaid, the larger the fee incurred.
Discount Fee
The amount earned by a factor on each invoice purchased. Discount fee is based on the period of time the invoice remains outstanding (unpaid) and is set forth and agreed upon by both parties in the Discount Schedule.
Discount Rate
The percentage of the face value of an invoice that a factor holds as its fee.
Due Diligence
The process through which consultants and funding sources assess the risk and authenticity of a deal. It consists of the gathering and verification of information and documentation necessary for the funding source to make an informed decision as to whether to accept a prospect as a client, thereby reducing the funding source's overall risk of loss.
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