What is Freight Factoring?

Getting paid shouldn’t mean waiting for brokers to process invoices. Factoring turns completed loads into immediate cash, so you can keep your trucks rolling and your business growing without the stress of slow payments.

Freight factoring explained.

Freight factoring is a financial service that helps trucking businesses get paid faster. Instead of waiting on brokers or shippers to settle invoices, carriers sell those invoices to a factoring company like OTR Solutions for immediate payment. The factoring company then collects from the broker, keeping cashflow steady and operations running smoothly.

How does freight factoring work?

Freight factoring simplifies the payment process so you can focus on moving freight, not chasing down invoices. Here’s how it works:

Find, load, and haul freight

Carry a load from a broker who is approved on the OTR Broker Check tool and obtain proper documentation.

Submit invoices and get paid

Upload your rate confirmation and proof of delivery to the OTR Client Portal / Mobile App. Once approved, we initiate payment to your bank account.

We invoice

Instead of sending invoices directly to every broker you work with, after you upload an invoice to OTR, we invoice your broker within 24 hours on your behalf.

Broker pays us

OTR’s in-house accounts receivable team tracks invoices waiting for payment and collects that payment when it’s due.

What are the different types of freight factoring?

[True Non-Recourse Factoring]
Only offered by OTR Solutions, True Non-Recourse Factoring transfers all risk to us after the invoice is factored. If we can’t get paid, we take the loss and will not come back to you like other generic non-recourse programs will.
[Fleet Factoring]
A fully customized and curated factoring program for larger operations, offering greater flexibility and a centralized back-office to enable more cost efficient scaling of your operation. Available TMS integrations make Fleet Factoring the optimal choice for all fleets.
[Broker Factoring]
Eliminate cash float to keep freight moving and carriers paid on time. Broker factoring provides the working capital to manage all sides of your brokerage and better compete with available carrier payment options like quick-pay.

Without Factoring

Without freight factoring, slow broker payments create cashflow gaps, making it harder to cover expenses, take on new loads, or grow your business.

With Factoring

With freight factoring, you receive payment within 24 hours, skip the hassle of collections, and keep operations running smoothly.

Learn more about freight factoring with OTR Solutions.

See how factoring helps trucking businesses stay cashflow strong and focused on growth.

Frequently Asked Questions

Got questions? We’ve got answers.

Find out everything you need to know about freight factoring, from how it works to how you get paid.

How long does freight factoring take to pay?
Most freight factoring companies pay within 24 hours of invoice approval. With OTR Solutions, carriers receive same-day funding on approved invoices. For even faster access, Truly Instant Funding delivers payments instantly, 24/7/365.

Do I need to factor every invoice?
No, most freight factoring programs let you choose which invoices to factor. This flexibility lets carriers factor only certain brokers or loads, helping control costs while still improving cashflow when needed.

Is there a credit check required to start freight factoring with OTR Solutions?
No credit check is required to start factoring with OTR. We ask for documents such as proof of insurance, articles of ownership, and operating authority.

What type of freight factoring is best?
Non-recourse freight factoring is typically the best option, as it protects carriers from broker non-payment. With OTR Solutions’ True Non-Recourse Factoring, there are no chargebacks and all collections are handled for you, making it a strong option for new authorities.

Is Quick Pay better than freight factoring?
Freight factoring is usually more reliable and faster than broker Quick Pay. Quick Pay programs typically take 1 to 5 days and can change rates without notice. Factoring provides consistent funding timelines, often within 24 hours, along with payment tracking and support. To learn more, check out our guide on Quick Pay for truckers.

How do I know if I need freight factoring?
Freight factoring may be a good fit if delayed payments make it difficult to cover fuel, payroll, or operating expenses. Carriers operating week-to-week often use factoring to stabilize cashflow and avoid disruptions caused by slow-paying brokers.

What should I look for in a freight factoring company?
Look for transparent rates, reliable payment timelines, and dedicated support. Non-recourse protection, in-house collections, and easy invoice submission tools are key signs of a factoring partner built for carriers. For more information, see our guide on how to choose the best freight factoring company.

What is freight factoring?
Freight factoring is a financing solution where a trucking company sells its unpaid invoices to a factoring company for immediate cash. Instead of waiting 30 to 90 days for broker payments, carriers can get paid within 24 hours or sooner. The factoring company then collects from the broker directly.

A smart move in the right direction.

New to the business or expanding your fleet, we only succeed when you do. We’ll bring the tools and support. You bring the hustle. Let’s move forward together.