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Freight Factoring Fees Explained

When factoring, you’ll come across many types of fees. Some factors charge lower initial factoring rates but have many hidden fees. Some may even increase their rates over time. Not every factoring company charges these fees but it’s important for you to take them into consideration when picking a factoring company.

Common fees

Application: Some factors require a fee just to apply, whether or not you get approved! These fees can cost a few hundred dollars.

Sign-Up: Upon approval, some factors require you to pay an initial fee to start factoring with them. These fees can also cost a few hundred dollars and won’t apply towards a factoring fee on a load.

Termination: If you have a contract with a length of terms and decide to stop factoring before the contract expires, you may get charged a lot of money to break that contract. Be careful when deciding the lenght of your contract!

Hidden fees to watch out for

ACH Transfer: There are companies that charge a fee to electronically transfer or deposit funds into your account. These fees can range from $10 to $25, which can really add up to a lot of money over time!

Minimum Volume: Some factors require carriers to factor a minimum number of loads. If that minimum volume of invoices is not met, they either charge an extra fee to the carrier or increase the factoring rate percentage.

Credit Checks: Before picking up a load from a broker, you want to know if that broker is reliable and will pay your factoring company. In some cases, you might have to pay for every broker credit check you request from the factor. Read more here.

Reserves: Factors may charge reserve rates as an insurance in case a broker fails to pay. This means a percentage of your invoice amount is kept “on hold” for 30 days or until a broker pays the factor. Read more here.

Same-day Funding: You may pay extra to get your funds deposited the same day in your account.


When picking a factoring company, always read the fine print and make sure you're not being charged more than you're expecting! Transparency is key to making sure factoring is working for you and your business.
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