What does it take to be approved and start receiving advances on your invoices?
Your Line of Credit
Your Escrow Reserves
"Without you I wouldn't have survived in business."
"I've had several larger factors contact me to see if I'd like to factor with them. I'm very happy where I am with Dash Point Financial."
1. Submit a completed application form. We charge no application fees and no set up or due diligence fees. (Please compare our rates to see what else we don't charge!)
2. Your application is reviewed the same day it is submitted. If your application is approved you will receive an email containing the final documents to complete and thereby establish your account. These emailed documents arrive signed by our company president.
3. We use RightSignature.com to sign the contract electronically. You may submit your first invoices with the contract and setup documents if desired. A Notice of Assignment letter (see next section) to your customers is sent by us via Registered email.
4. Advances are provided within 24 hours of invoice submission via electronic funds transfer or bank wire. We establish a modest Escrow Reserve with a small temporary deduction from your advances to cover possible future unpaid or short paid invoices.
Together we provide customers you choose to factor a Notice of Assignment letter which informs them of your financially strengthened position as a result of our alliance, plus your new remittance address.
Their checks are made to “Dash Point Financial FBO Your Company Name” (FBO means “For Benefit Of”) and sent to our post office lock box. This way there is no question your customers’ checks are paying your invoices, and they will send payment to the correct address. Prior to your first advance we follow up with a phone call to verify they have received the letter and made the remittance address change in their system.
Your customers may pay by check, ACH, or wire. Receiving checks and ACHs are free; a wire fee applies when a wire is received.
Once you’ve received your Advance and your customer later pays us for your invoice, you receive a Rebate (see #7 of How Does This Work?). We send your rebates with your next advance, or weekly when they total $250 or more. We do not withhold rebates when your customers pay in full, nor wait until the following month to give your rebates. Our funds transfers for advances and rebates are quick, inexpensive, and paperless. Since we don't use checks, you don't need to worry about paying for an overnight mail charge every time you're funded, or whether your bank will put a hold on our check.
Our clients begin factoring with a line of credit of $10,000. That is, you may have up to $10,000 in factored invoices awaiting payment at a given time. This credit line can be increased as your business grows and the dependability of your customers’ payments is established.
Only factor customers whom you are sure will pay your invoices. However, a few customers occasionally do not pay in full or at all, and funds are needed to cover these shortfalls. Therefore, as a matter of prudence, we establish a “rainy day” fund we call an Escrow Reserve for every client, to prevent problems arising from unpaid invoices.
Your Escrow Reserve has a cap, which equals 10% of your Line of Credit. That is, when you begin factoring with a $10k Line of Credit, we’ll be “feeding” your Escrow Reserve until it reaches the cap of $1k.
To do that, we simply set aside 5% of each invoice from your advances and put that money into your Escrow Reserve. So if you’re approved for an 80% advance, 5% goes into Escrow and 75% goes to you. Once your cap is reached you receive the full 80%. Escrow funds accrue quickly when you factor steadily.
Your Escrow Reserve cap is always 10% of your credit line. So as your business grows and your Credit Line needs to be increased from $10k to $15k, your escrow cap increases as well, from $1k to $1.5k.
If Escrow funds are needed to cover a short paid or unpaid invoice, or your Line of Credit increases, the advance deductions resume until the Escrow cap is once again reached.
When you arrive at the point you do not need to continue factoring, funds in your Escrow Reserve are returned to you. (Interest does not accrue on these funds.) You need to be certain you are finished factoring before receiving these funds.