1 Many businesses who are interested in factoring invoices have tried many other methods to obtain capital for their business needs. The first critical step in the process is to determine what your financial needs are.

2 Once you have determined what your financial needs are and what you will do with the capital once you receive the funds, it's time to complete an application located here.

3 After having your application approved, it's time to setup an auction. This takes approximately 30 seconds to complete. Setting up an auction requires you to know the type of financing you are interested in. FactorAuction.com offers both invoice factoring and invoice discounting as an option. With both options, you will receive immediate cash for your accounts receivable. The difference is that you will be responsible to collect payment from your customers while with invoice factoring the factor will collect payment from your customers.

Another difference with factoring compared to invoice discounting is that your customers will be notified that you sold the invoice. With invoice discounting they will be unaware that the invoice was sold.

Other options you can choose from includes the amount you would like to be advanced and rate you expect or are currently receiving. The industry average advance is 85% of the invoice and the average discount rate is approximately 3% per month of the invoice total.

4 Once your auction has been setup factoring companies will compete against each other to get you the best rate and highest advance amount.

5 Once the auction has ended or at anytime you may choose a winning company. At this time you are under no obligation to move forward with that company, but you have now been introduced to a company offering you a fantastic rate and advance amount.

6 You now can enter into an agreement with the company of your choice and receive your cash.