The Invoice Financing calculator will show you how much invoice financing will cost you.
Below are terms to know that will help you.
- Advance Rate: Refers to the percent of the invoice value a lender will pay your company when your receivables are financed. In general, lenders typically give 70%-90% of your accounts receivable value. The default rate for the Lendzero Invoice Financing calculator is 80%.
- Reserve: Amount of the invoice value not advanced to the company. The reserve is given back to the company after the invoice is paid.
- Factor Fee: In this structure, the lender charges a small percent of the invoice e.g. 1-3% before the balance is paid. As such, more factor fees will be due the longer an invoice goes unpaid.
Rebate: After your client pays the invoice, your lender rebates you some of the advance that has been held in reserve, minus any fees.
