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7 Factors in Choosing a Factoring Company

7 Factors in Choosing a Factoring Company

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Seven things decide whether a factoring company helps you or quietly costs you money: industry experience, funding speed, fee transparency, support, technology, reputation, and contract flexibility.

We have served trucking for 26+ years and funded 26,000+ loads (as of 2026). Here is what to ask about each.

Does the Company Have Freight Industry Experience?

Freight factoring is not the same business as general receivables factoring. A trucking specialist knows bills of lading, rate confirmations and FMCSA compliance. Check three things:

  • Years in the freight industry. Companies with long track records have weathered market cycles and refined their processes. MJN Services has been in operation since 2000.
  • Client base. A company that serves owner-operators, small fleets, and growing carriers understands the range of needs in trucking.
  • Specialization. Some factoring companies serve many industries. A freight specialist understands your specific challenges.

Ask how many of their clients are in trucking specifically. A company that serves mostly medical or staffing clients may not understand carrier-specific workflows like BOL verification, lumper fee reimbursement, or the difference between a rate confirmation and a bill of lading. Ask whether they have staff who have worked in freight operations, not just finance. That operational knowledge shows up in how quickly they process invoices and how well they handle disputes with brokers.

How Fast Does the Company Fund Invoices?

Every day you wait is a day you defer fuel, maintenance or payroll. Three things to check:

  • Look for same-day ACH funding. At MJN Services, invoices received by 1:00 PM MST are paid the same day, with MJN issuing your ACH payment the same day you submit.
  • Ask about advance rates. The percentage you receive upfront matters. Look for advance rates up to 95%, which means more of your money is available immediately.
  • Verify consistency. Some companies advertise fast funding but deliver inconsistently. Ask for references from current clients.

Are the Fees Transparent and Straightforward?

Get the fee schedule in writing before you sign. It should name:

  • The factoring rate. At MJN Services, rates start as low as 1.5% of the invoice value.
  • ACH or wire transfer fees. How much does each payment cost?
  • Credit check fees. Are customer credit checks included or charged separately?
  • Setup or onboarding fees. Is there a cost to start the relationship?
  • Minimum volume penalties. Are you penalized for factoring fewer invoices than expected?
  • Early termination fees. What does it cost to leave if the partnership is not working?

Compare total cost per invoice, not the headline rate. A 1.2% quote with a $15 ACH fee and a $5 invoice fee works out to 2.5% on a $1,500 load.

How Good Is the Customer Support?

When an invoice goes sideways you need a person, not a queue. Check:

  • Accessibility. Can you reach your account manager by phone during business hours? At MJN Services, carriers and agents speak directly with owners and decision-makers.
  • Response time. How quickly does the company respond to questions or resolve issues?
  • Back-office services. Does the company handle credit checks, collections, and documentation? These services save you significant time.

Test the support experience before you sign. Call the company’s main number during business hours and see how long it takes to reach a real person. Ask a specific question about how they handle a disputed invoice or a short payment. The quality of the answer tells you whether you are talking to someone who understands freight or someone reading from a script. If you cannot get a knowledgeable person on the phone before you are a customer, it will not improve after you sign.

Does the Company Use Modern Technology?

Three questions:

  • Easy invoice submission. Can you submit invoices digitally without printing and mailing documents?
  • Status visibility. Can you check the status of your invoices and payments online?
  • Integration. Does the company’s system work with your existing tools and load boards?

At MJN Services you submit the invoice and proof of delivery digitally by 1:00 PM MST. When MJN brokered the load, the details are already on file, so there is no third-party verification step to wait on, and the ACH goes out the same day.

What Is the Company’s Reputation?

Reputation is the one thing a company cannot write for itself. Three places to look:

  • Asking other carriers. Word of mouth from trucking professionals carries weight. With 39,000 approved carriers in our network (as of 2026), MJN Services has built relationships across the industry.
  • Reading reviews. Look for patterns in feedback, not isolated complaints. Consistent themes (positive or negative) are meaningful.
  • Checking credit ratings. MJN Services holds a Truckstop Credit Rating of A and a Transcredit Score of 98 (as of 2026).

How Flexible Are the Contract Terms?

Your volume will change. The agreement should let it:

  • Contract length. At MJN Services, initial contracts start at 3 months so you can evaluate the partnership before committing long-term.
  • Scalability. Can the company handle your growth if you increase invoice volume?
  • Invoice flexibility. Some companies require you to factor every invoice. Others allow selective or spot factoring.

Read the full contract before signing, including the renewal clause. Some companies auto-renew for a full year unless you cancel within a narrow window (often 30 days before expiration). Ask what the early termination fee is in dollar terms, not just “subject to contract.” If a company will not give you a straight number, that tells you something. Also ask whether you can reduce your volume without penalty during slow months. Freight is seasonal, and your factoring agreement should reflect that reality.

Ready to find the right factoring partner? Explore our factoring programs to see rates, advance percentages, and terms, or contact us to talk through your specific situation. MJN Services has served the trucking industry for 26+ years with 127,000+ loads brokered (as of 2026).

Frequently Asked Questions

What should I look for in a freight factoring company?

Look for industry experience, fast funding (same day or better), transparent fee structures with simple, published rates, responsive customer support, flexible contract terms, and strong advance rates up to 95%. A company that specializes in freight understands BOLs, carrier compliance, and the urgency of cash flow in trucking.

How important is funding speed when choosing a factoring company?

Funding speed is one of the most important factors. Every day you wait for payment is a day you may not be able to cover fuel, payroll, or maintenance. Look for companies that fund within one business day. At MJN Services, invoices received by 1:00 PM MST are paid the same day, with MJN issuing your ACH payment the same day you submit.

What fees should I watch for with factoring companies?

Beyond the headline factoring rate, watch for setup fees, ACH or wire transfer fees, credit check fees, minimum volume penalties, and early termination fees. Ask for a complete written fee schedule before signing. If a company will not disclose all fees upfront, consider that a warning sign.

Should I choose recourse or non-recourse factoring?

Recourse factoring has lower fees but you are responsible if your customer does not pay. Non-recourse factoring costs more but the factoring company absorbs the loss. Choose based on your customers' reliability. If you work with established shippers, recourse is usually more cost-effective. MJN Services offers both options.

Get Paid the Same Day You Deliver

Rates as low as 1.5%, advance rates up to 95%, and same-day pay on invoices submitted by 1:00 PM MST. Rates are published in writing.

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