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Dry Van Factoring is the process in which an owner-operator or a trucking company sells an outstanding truck freight bill to a factoring company for a cash advance.
Up to $1597
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Top 3 Dry Van Factoring Benefits for Owner Operators
Compare and choose the right Dry Van factoring plans from our recommended factoring companies that are 100% safe for owner operators. Get the best for your trucking business. Generate truck factoring proposals and quotes in minutes.
Dry Van Factoring With Fuel Line of Credit
Get Fuel Line of Credit Factoring Program up to $6000 per truck per week with your Dry Van factoring program. Fuel expense is no more a headache.
Dry Van Factoring With 1% Factoring Rate First Month
A new owner-operator should save every penny that is possible. Get multiple Dry Van factoring proposals from top factors with MaxTruckers offer of 1% factoring rate for first month.
Dry Van Factoring With Dispatch
Get high paying loads with MaxTruckers Dispatch, the best dispatch company in the USA along with factoring. To experience the Dispatch quality , you get discounted dispatch price of just $49 per week. NO fixed percentage, NO commitment and SAVE thousands of dollars!
Highlights of Our Dry Van Factoring Proposal
Dry Van Factoring Advantages with MaxTruckers
FREE Start-Up Kit Worth $500
What is dry van factoring?
Dry van factoring in trucking:
Dry Van factoring is an important part of truck factoring. Dry Van factoring helps dry van drivers/owners to get cash for pulled load instantly or in 24 to 48 hours.
The driver needs to ply a load to generate an invoice. Then send it to the factoring company via email, or upload it through the website, take a photo and use the mobile app to send it to the factor.
How does dry van factoring ease trucking business cash flow issues?
Dry van factoring, liquidity, and cash flow solution:
Cash is King in the trucking business, but truckers/owners/driver has to wait 30 to 90 days to get paid by brokers/shippers. This long wait time will create a cash crunch in a dry van trucking business.
So the best option is to submit the dry van trucking invoice to a factor, here the factor takes a cut between 1.5% to 5% depending on load volume and size and pays the trucker rest of the amount. The truck invoice factoring is a key supporting structure that truckers use to inject l working capital into their businesses.
Why is dry van factoring important for truckers?
Dry van truck factoring is vital:
Dry van factoring provides operational flexibility, working capital, and liquidity into a trucking business. Usually, a trucker needs to wait for 30 to 90 days (payment cycle) to get paid by a broker/shipper. This creates a cash crunch which might even force them to close the business, if not solved fast.
Other than liquidity injection, operational freedom a factoring company helps small and medium truckers to get on top of their carrier side paperwork and secretarial documents.
The money thus got from the factor can be used for working capital expenses like fuel, driver salaries accommodation & amenities; equipment maintenance and upkeep, tire or oil change, etc.
How do you select a dry van factoring for your business?
Selecting a dry van factor for your business:
To select a dry van factoring company you need to keep in mind certain factors:
First and foremost you need to know what is the factoring rate, this rate decides how much money you get from the factor. The ongoing rates depend on the volume and size of invoices factored.
Secondly, you need to know if there is a lockin period for the factoring contract. It got be 3months, 6months, or even one 1year if you break the lockin period clause you will have to pay a termination fee, which would be a hefty sum of money.
Thirdly, you need to also see if there is a hidden dedication like some companies charge credit check fees. You should be on the lookout for hidden fees, ask the company executive to know more about this.
Fourthly, you need to see if there is a contract termination fee, if there is one you should steer clear of that factor.
Fifthly, you should be forced to factor in all your invoices. A factoring company with a minimum volume requirement reduces your flexibility and profitability. If you think you do not have to factor an invoice at a certain time, the factor should not force you to do so.
Sixthly, you need to have robust, energetic, problem solving and dedicated customer support. If you are facing a problem the dedicated customer should solve it 24/7/365.
You need to also check if the factoring company has reserves, this reduces the cash credited into your account. Ideally, zero reserves is the best service model.
Lastly, you need to see what are the extra benefits the factoring company is giving you like load board, insurance (for new operators), bookkeeping support, fuel card with multiple benefits, roadside rescue, fuel line credit, etc.
What is the cost of dry van factoring?
Cost of dry van factoring:
The factoring cut or commission is deducted from your invoice. This is usually the cost of factoring, some companies deduct a reserve also, this is paid back after the customer pays the factor. The commission is about 1.5% to 5% depending on the factoring type of factoring, volume, and size.
What are recourse and nonrecourse dry van factoring?
Recourse and nonrecourse dry van factoring:
Recourse factoring makes you responsible for the payments of your brokers/clients/shippers. It means if your clients fail to pay your account would be debited by the factor, they will take the money that they paid for the invoice. Recourse factoring is comparatively cheaper than nonrecourse factoring. If you have creditworthy clients you can go for recourse factoring. From the factor side, the credit check and credit history lookup, etc would be lax compared to nonrecourse factoring because the factor has to low possibility of loss here.
Nonrecourse factoring is costly compared to recourse factoring. Here the factor assumes the risk of no repayment under certain conditions like bankruptcy and insolvency etc. If you have some client with a patchy business setup or weak bottom lines you can opt for this. Factor due diligence is very expansive in this option, they check each and everything connected with credit score, credit history, business liquidity, etc.
Is the dry van factoring worth it?
Dry van factoring is worth it!
Liquidity is worth a lot in the trucking industry. Factoring helps truckers to get cash without strings attached to it. The only cost of factoring is the factoring fee/cut that brokers take. A factor gives instant cash when truckers factor, this gives them money pay their fuel expense, equipment maintenance and upkeep expenses, driver salaries, lodging, food, and amenities; and even for insurance payout, etc.
The other alternatives to factoring is working capital bank loan and quickpay. A working capital loan is a worthy option but it takes time and its a cumbersome process, plus there is an interest cost associated with it. Quickpay is a good option provided by brokers, but not all brokers provide it.
What are the merits and demerits of a good dry truck factoring contract?
Merits and Demerits of dry van factoring:
Merits of dry van truck factoring:
Easy way to inject liquidity into your business
Trucking startup friendly
Low invoice/ bill commissions or factor cuts
It’s a short and long term liquidity option
Demerits of dry van factoring:
Invoices must be paid in 90 days
Should have quality and highly creditworthy customers to start factoring
Control of accounts receivable is lost
Taking credit based on accounts receivables in hand is not possible
What are the additional benefits of joining MaxTruckers dry van factoring?
Added benefits of joining MaxTruckers dry van factoring program:
Maxtruckers provides you a very cool, fuel card with super benefits like 35 to 45 cents rebate on a gallon of diesel, equipment maintenance discounts, oil and tire change discount, supplies and driver food and lodging discounts, acceptance in 1000 plus fuel stations and truck stops. Plus this card does not have any owning cost, hidden cost, or operating cost.
Fuel line of credit:
MaxTruckers provides up to 50% advance from your invoice as a fuel line of credit so that you can easily carry and deliver your next high-paying load.
Flexible volume requirements:
MaxTruckers won’t ask you to factor all your invoices with them. You decide which invoices you wanna factor in, there is no factoring volume limit with MaxTruckers.
Positive contract terms:
MaxTruckers wants to provide you with a positive, open, and transparent contract. We do not have hidden. surprising and bad terms that damage our relationship with you. We keep an open and welcoming contract we do not use terms like termination fees or hidden charges in our vocabulary.
We make applying for factoring simple you can either apply by uploading BOL/invoices pics via the web portal or mobile app, plus you can send you paperwork by sending an email.
Best customer support:
We have dedicated, robust, and problem-solving customer service. The customer service team will help you find, negotiate, and onboard with the best factor. After onboarding, we will help you set up and run your invoice factoring task. We will help you 24/7365.
We have created a knowledge portal that helps owner-operators succeed in business. We share our knowledge about all trucking-related topics such as:
finding a broker/shipper who works with new MC drivers/owners with our dispatch service.
- How to find good loads to pull?
- Which load boards to use?
- What are insurance requirements?
- How to find the best dispatch company for your business?
- Who to find a good factoring company to work with?
- How to find comprehensive insurance policy coverage for all your needs?
- What are the bookkeeping and accounting requirements?
- What are the ELD and reporting norms etc?
DAT Load board Subscription:
MaxTruckers provides you with a one-month free trial of DAT TruckersEdge load boards, the industry-leading loadboard in the USA. With it, you can hunt, find and negotiate high-paying loads from your mobile and desktop. Every day DAT TruckerEdge hosts 600,000 unique loads, you can put your trucking company in hyperdrive using DAT TruckersEdge.
300 member broker list for new MC owners/drivers:
We understand how hard it is to work as a new MC operator/trucker, so we have created a list of 300 brokers who are ready to work with new owner-operators.
Trucking Startup Friendly:
We know how hard it is for trucking startups to survive in the hyper-competitive trucking space. We provide you with the tools, operational acumen, and contacts to prosper in all facets of trucking. Maxtruckers also provide knowledge resources, tools for the operation, due diligence. We provide vital services insurance like factoring, bookkeeping, etc for fresh of the blocks trucking companies.