If you’re an entrepreneur, you’ve probably noticed that there are many options when it comes to funding your business. While some are safer than others, there’s one funding option that stands out from the rest: property-free factoring companies.
But what exactly is property-free factoring? And why do so many entrepreneurs choose this kind of factoring company over traditional sources of financing like loans and mortgages?
Let’s explore some of the major advantages of property-free factoring companies in more detail.
No Cash Risk
- No cash risk. You don’t have to worry about losing your cash flow or investment because property-free factoring companies are not investors. They simply want to be paid on time and in full. If they don’t get paid, they can take legal action against you or your business partner.
- No client risk. A property-free factoring company won’t care if one of your clients goes bankrupt or stops paying their invoices; they’ll simply deduct those debts from future payments until they’ve been paid off completely. This means that even if one of your clients is experiencing financial difficulties, there will still be enough money left over for other clients doing well financially!
No Collateral Risk
One of the most common complaints about factoring companies is that they require collateral. This is not true for property-free factoring companies, which do not require any security at all. Instead, you can use your business as collateral when applying for a traditional bank or credit union loan.
The second major misconception about these types of financing options is that they require private mortgages or liens on your property to be approved for funding. Again, this isn’t true!
A property-free factoring company in Australia will accept applications from businesses regardless of whether or not they own their building(s) outright – which means no more worrying about losing everything if something goes wrong with your business operations!
No Equity Risk
When you factor in with a property-free factoring company in Australia, you can rest assured that the third party is not interested in taking over your business. They don’t get any equity and they don’t own any assets.
The only thing they are looking for is cash flow from their clients’ invoices, which makes sense because this also keeps them running!
No Transfer of Title Risk
When you sell a property, there is always a risk of losing title to it. This can happen if your buyer fails to pay for the property and then goes bankrupt or defaults on their loan. In such cases, you may have no choice but to go through the courts in order to recover possession of your property.
Property-free factoring companies do not require you to transfer ownership of any assets before they will accept them as collateral for factoring agreements. You keep full control over all assets while they remain in your possession until they are sold off to repay debts owed by customers who have used credit facilities provided by these companies.
Conclusion
We know that you’re looking for a way to grow your company without taking on all the risks associated with property-based factoring. But you have the option to choose a factoring company that doesn’t need your asset as a security!