There are four steps to utilize our Invoice Financing calculator.
- Put in the total amount of the invoice you want to finance.
- Put in the estimated invoice factor fee as the interest rate.
- Choose the net terms of the invoice by amount of weeks.
- Determine your payments. Try estimating with different terms, so you can project the potential expense of funding whether your client pays their invoice in four weeks or 12 weeks.
Sample of How to Utilize the Invoice Financing Calculator
For example, Tom’s Bakery factors a $10K invoice. The lender advances Tom 80% of the invoice value ($8K) and charges a 1% factor fee weekly until the invoice is fully paid.
It takes Tom’s client eight weeks to pay their invoice. As such, Tom incurs $800 in fees. That amount is subtracted from the $2K reserve and Tom receives a $1.2K rebate.