Self liquidating debt


15-Nov-2019 21:00

This makes accounts receivable factoring and ideal solution for companies that have working capital problems and need quick financing.

A bond used to finance the purchase of assets intended to be sold within a short period of time.

Then the borrower takes the revenue generated from those business activities and uses it to repay the money that was borrowed to finance the activities.

The term can apply to a company that experiences seasonal fluctuations in business.

It refers to a loan that is used to generate proceeds that are in turn used to repay the loan.

Basically, a borrower takes out a loan used to finance business activities that generate revenue.

It is called a self-liquidating loan because the proceeds from the sale of the assets provide the capital with which the debtor may repay the loan.

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This provides an injection of working capital into your company that can be used to pay for corporate expenses.The transaction is liquidated once your end customer pays their invoice on their regular schedule.Invoices are funded with a simple structure that uses two payments for the transaction.Additionally, the invoices cannot be secured by liens from other companies or government entities.

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Most financing lines can be deployed quickly – in a week or so.

Or you can decline the contract, and lose a valuable client. You can solve this problem with a type of self liquidating transaction known as invoice financing.