April 12, 2008
April 5, 2008
Customer Perceptions About Invoice Factoring
Many companies considering using accounts receivable factoring are worried that their customers will perceive them as "going under". This is a concern with most prospects that are unfamiliar with factoring. The issue centers around notification and collection. At the inception of a factoring relationship, each account debtor is notified that a secured party (the factor) has taken title to invoices in which they owe payment. The letter also states that all present and future invoices due must be paid directly to the factoring company until otherwise notified by the factor. This is necessary to do this because if protects the factor's collateral and to be protected by the UCC.
Many business owners worry that they will be perceived in a negative light when the customers get these notices. There is no reason to worry. Factoring is hardly a new form of financing. Many industries (manufacturers, distributors, apparel & textile, trucking, and temporary staffing) rely on the services a factor provides. Factors only interact with customers on a random basis, mainly at the inception of the relationship.
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Need a quick infusion of cash? Click here to apply for a factoring quote.
Kent Harlan, CPA
www.ocflink.com
kenth@ocflink.com
417.849.7394
April 2, 2008
Should the Government Intervene in the Housing Crisis?
Today, I'm straying from the usual topic of invoice factoring to briefly discuss a hot-button topic for me: government intervention to solve problems in the housing market. There is now pending legislation that would provide relief to home owners that are on the brink of foreclosure. Sounds compassionate doesn't it, especially when you have the perception that the homeowners are in the situation they're in because of predatory lenders. I would agree that lenders have the obligation to fully disclose all the terms and conditions of the transaction and how it might effect them in the future (especially when people opt for teaser rates, then get hammered later on). But nobody seems to bring up the personal responsibilty angle of the individuals buying properties that are outside their means.
Bailing out people who have made poor decisions in their lives seems absolutely absurd to me. Do we really want our children to grow up with the idea that they can act in an irresponsible manner without repercussions? Do we want them to view government as a saviour? I don't think so.
I made a poor decision a few years ago when I trusted what turned out to be the owner of a shady real estate company. To make a long story short, myself and many others were defrauded into buying houses that were supposedly undervalued, but actually weren't. I bought a house as an investment that I was led to believe would be sold quickly at a good gain. Two and a half years later, I'm still in a home that is twice as big as I need with a mortgage payment I can't afford. Did I ask the government to bail me out? No, I'm taking responsibility for the mortgage I signed and despite the fact that my net worth is eroding each month, I'll continue making the payments in a timely manner.
Let the free market work this mess out. Government bailouts will only magnify the problem.
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Need a free invoice factoring quote? Click here.
Kent Harlan, CPA
Ozarks Capital Funding, LLC
www.ocflink.com
kenth@ocflink.com
(417) 849-7394
