Factoring for Freight Brokers
Carriers factor to get paid faster. Brokers factor to pay carriers before the shipper pays them. Different product, different underwriting.
A freight broker's cash problem is the inverse of a carrier's. You owe carriers quickly — often on quick-pay terms — while shippers pay you on 30 to 60 day terms. Broker factoring funds that gap against your shipper receivables.
How it differs from carrier factoring
- Underwritten on shipper credit and on your operational controls, not on a BOL.
- Often bundled with carrier payment processing — the factor pays your carriers directly.
- Bond and authority requirements apply. Your BMC-84 status is part of the assessment.
- Concentration limits matter more. If one shipper is most of your book, that caps the facility.
- Higher scrutiny on double-brokering controls and carrier vetting.
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What to compare
Compare the all-in cost of the facility against what quick-pay discounts earn you. Many brokers factor specifically to fund carrier quick-pay, where the quick-pay discount they capture partly or fully offsets the factoring cost. Model both sides before deciding the facility is expensive.
The risk to price in
Your exposure is a carrier who is not paid claiming against your bond, and a shipper who does not pay leaving you funding both sides. Ask any prospective factor how carrier payment disputes are handled and who carries the loss when a shipper defaults after carriers have been paid.
Why some numbers on this site are blank
Every other factoring comparison site fills its rate columns. Most of those numbers are the advertised teaser rate, republished without checking what a real small operator is quoted. We publish a figure only when we have a primary source: the company's own published page, or a quote we obtained ourselves. Where we do not have one, the cell says Not published. That gap is honest and it closes edition by edition.