If you own your own business and are looking for consumer receivables financing (financing for consumer notes,consumer contract financing, or retail installment contract financing) it will be to your benefit to be aware of exactly what type of financing you are looking for as well as being able to provide general information to enable a consultant to direct you to the proper funding source.
For example if you are looking for consumer receivables financing you should know ahead of time whether you are interested in recourse or non-recourse. In terms of recourse, if your customer does not pay within a specified period of time, the funding source will expect compensation from you for the advance that would have been provided for the contracts already funded. Generally speaking this would usually entail a non-performing contract being replaced by another contract which is performing. On the other hand you may wish to consider non-recourse funding in which circumstance, if your customer does not pay the funding source you have no responsibility to provide compensation. Non-recourse funding is almost always accompanied by very high discounts and/or reserves. The funding source will naturally want to be protected from the inerrant risk associated with non-recourse funding. Recourse funding is associated with lower discounts and/or reserves and is by far the most common of the two.
Also, if you are looking for consumer receivable financing (financing for consumer notes, consumer contract financing or retail installment contract financing) you may expect that the funding source will want to see a copy of the retail installment contract you are using. Some people who seek funding believe they have been doing business using a proper retail installment contract; however, sometimes we discover that they have been doing business using a simple agreement of some kind. A retail installment contract will specify a specific term (a length of time) wherein the monthly payments are to be made. The term may be, for example, a year or two years. The retail installment contract will specify the exact monthly payment to be made, and if interest is being charged the retail installment contract will specify the exact amount of interest to be paid. The retail installment contract being used is very important and both you and the funding source will have to feel comfortable with it before moving forward.
At some point in time you will probably be asked if you check your customer's credit. The reason you will most likely be asked this question is that any funding source will want to begin to understand the credit worthiness of you customers. The higher the credit scores of your customers the lower the discounts and reserves will be for the consumer contract financing (retail installment contract financing ) you are seeking.
Most of the prospective clients who contact us have web-sites; but some prospective clients do not. If you are serious about seeking consumer receivable financing (consumer contract financing) you can be sure that it is to your advantage to have a professionally done web-site that represents your company in an accurate way. Probably the most effective way for us to present you to a prospective funding source is to introduce you by welcoming the funding source to your web-site where that all important first impression will be made.
These are some of the initial questions and considerations for you to begin to think about.
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Read about Consumer Contracts Financing Process Part 1
Consumer Contracts Financing Process Part 2
Consumer Contracts Financing Process Part 3
Consumer Contracts Financing Process Part 4
Consumer Contracts Financing Process Part 5
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