Factoring Government Contract Receivables

We know your government contract cash flow problems.

- Big contracts use up all your operating capital and pay net 30 to 60 days later.

- Cash flow shortages in weekly payroll and fixed overhead.

- Passing up new contracts and sometimes can't even fulfill the ones you have on hand.

At 1st Commercial Credit, we can provide immediate funding for your business. The invoices to your customers for goods delivered or services rendered can be converted into a "Business Credit Line" from which you may draw cash to better manage your business.

We have experience in financing receivables to companies whose primary business is performing technical services or manufacturing for the federal government. Technical service companies may include those that provide computer-related services, communications systems, computer systems maintenance, programming support, facilities management, logistics, engineering, and military related products, temporary staffing, distributors and other types of manufacturers.

The most common problem that businesses find in trying to find funding for government receivables:

Most factoring companies do not want to fund receivables that contain high concentration in a few customers which is very common in the government contract industry. One recent transaction funded in the range of $736,000 for just one invoice.

Some receivable finance companies do not have the knowledge in dealing with government receivables. We have specialized experts that are familiar with the "Assignment of Claims" which is a federal law which allows and specifies the procedures for assigning financial rights to invoices of government contractors. The Federal Acquisition Regulation (FAR) also governs how we carry out our responsibility for effecting the assignment.

Any Business can qualify for a factoring receivables credit line if:

- Any Business can qualify for a factoring receivables credit line if:

- Sell credit worthy businesses or local, state or federal agency so long as a notice of assignment is accepted.

- Have not pledged accounts receivable as collateral.

- You have completed the work or delivered the product and your customer has accepted the invoice.

What kind of government contractors come to us for funding?

- Young companies experiencing growth and need cash today. In most cases they have been turned down by traditional bank loans due to a lack of a financial track record.

- Companies that are experiencing lack of service from another factoring company.

- Mature companies that have capped their working credit line established by a bank and need more leverage. This situation may require to pay the financial institution off so the client can establish an unlimited factoring credit line that will be based on the customer's credit worthiness.