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Factoring Fee Calculator for Owner Operators

Find what factoring really costs, including the yearly rate, and compare it with waiting for broker payment.

Invoice & Factoring Terms

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How does the contract charge its rate?

Take these from your factoring contract. Reserve holdbacks, wire fees, monthly minimums and rates that step up the longer a broker takes to pay are where the real price hides.

Wait Alternative

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% annual

Cost of cash = what it would cost you to cover the gap another way (a credit line, a card, or fuel you can't buy). If you would otherwise miss a load or a payment, it is much higher than a bank rate.

Enter invoice details and click Calculate

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How much does freight factoring cost?

Freight factoring fees are often quoted at 1 to 5 percent of each invoice. The fee only buys cash for the days until the broker would have paid. So the true cost is the fee shown as a yearly rate: fee divided by cash advanced, times days over 365. A 3 percent fee to be paid 30 days early works out to about 36 to 41 percent a year, depending on the advance rate. So factoring pays off only when the cash is worth more than that to you. Contracts charge either a flat rate or a tiered rate that rises when the broker pays slowly, so check which one you have.

  1. Fee = invoice amount x factoring rate, plus any non-recourse premium, wire or ACH fees, and a share of any monthly minimum.
  2. Cash today = invoice x advance rate, less fees taken at funding. The rest is held as a reserve and returned, less the fee, when the broker pays.
  3. Effective annual rate = total fee / (cash received x days until the broker pays / 365).
  4. Example: a $3,500 invoice at 3% with a 90% advance costs $105 and gives you $3,150 today. With a 30-day wait, that is about 41% a year.
  5. If the contract is tiered, choose the tiered rate type and enter the base days, the extra fee and the length of each extra period. The table shows the cost if the broker pays in 15 to 90 days.
How factoring contracts charge, and what the terms usually mean
TermWhat it usually means
Flat rateThe same percentage of the invoice no matter when the broker pays
Tiered rateA base fee for a set number of days, often 30, then more for each extra period. One example is 2% for 30 days plus 0.5% for every 10 days after
Advance rateThe share of the invoice you get up front. The rest is held as a reserve and returned, less fees, when the broker pays
Non-recourseUsually covers only a specific credit event, such as the broker going bankrupt. Disputes, short pays and paperwork problems are often left out, and chargebacks can still happen
Other feesWire or ACH fees, monthly fees, credit checks and monthly minimums can add to the rate

Rates, advance rates and contract terms vary by company, your volume and your brokers. These descriptions come from trucking finance guides, so use the numbers and the definitions in your own contract.

Last reviewed October 2026. Sources: FreightWaves: what factoring costs, fees and rates; FreightWaves: what non-recourse factoring covers; FreightWaves: chargebacks in trucking factoring.

Frequently Asked Questions - Factoring Fee Calculator

What is freight factoring?
Factoring means selling your unpaid invoices to a factoring company for immediate cash, commonly within 1 to 2 days, in exchange for a fee taken off the invoice amount. Instead of waiting the 30 to 90 days a broker might otherwise take to pay, you get most of the cash now.
How much do freight factoring companies charge?
Fees commonly run 1 to 5 percent per invoice. Recourse factoring, where you're responsible for buying back an invoice the broker never pays, typically runs 1 to 3 percent. Non-recourse factoring costs more, roughly half a point to a full point above recourse, and often lands between 3 and 5 percent for small carriers. Guides report that solo owner-operators commonly pay 3 to 5 percent and large fleets 1 to 2 percent. Exact pricing varies by factor, your volume and your customers' payment history.
Is freight factoring worth the cost?
It depends on how much the speed of cash matters to you. Treat the fee as a financing cost and compare its annualized rate: a 3 percent fee to get paid 30 days early works out to roughly 36 percent a year as an annualized rate, while the same 3 percent to get paid 60 days early is roughly half that annualized rate, since the fee is spread over more days. It's generally worth it when the cash keeps trucks fueled and drivers paid, and less worth it if you could comfortably wait for standard terms.
What's the difference between recourse and non-recourse factoring?
Recourse factoring charges a lower fee, commonly 1 to 3 percent, but you have to buy back the invoice if the broker never pays. Non-recourse factoring charges a higher fee because the factoring company takes on some non-payment risk. That protection is narrow. It usually covers a specific credit event, such as the broker going bankrupt, and often does not cover disputes, short pays or paperwork problems. Chargebacks can still happen, so ask which events your contract covers.
What is a tiered factoring rate?
A tiered rate charges a base fee for a set number of days, often 30, and then adds a fee for each extra period the broker takes to pay. One example is 2% for the first 30 days plus 0.5% for every 10 days after. It can look cheaper up front, but when brokers pay slowly it can cost as much as a flat rate or more. Use the tiered option in this calculator and read the table to see the cost at 15, 30, 45, 60 and 90 days.
What do factoring companies charge besides the rate?
Many charge extras: wire or ACH fees on each payment, a monthly fee, credit checks on brokers, fuel advance fees and monthly minimums. Add them up in the calculator, because a low rate with many extras can cost more than a higher rate with none. Also ask about fees to end the contract early and whether it renews by itself.
What are chargebacks in freight factoring?
A chargeback is when the factoring company takes back money it advanced because the invoice did not get paid, or was paid short. Under recourse factoring that includes any invoice the broker never pays. Even many non-recourse contracts still charge back for disputes, short pays and paperwork problems. Ask your factor in writing when it charges back and how fast.
What is the reserve in factoring?
The reserve is the part of the invoice the factor holds back after the advance. With an 85% advance on a $25,000 invoice, $21,250 comes up front and $3,750 stays in reserve. When the broker pays, the factor returns the reserve minus its fees. Advance rates vary by company, your volume and your brokers' credit, so check yours in the contract.

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Go Further With Factoring Fee Calculator

Guides, services and reference pages that go with this tool.

Terms explained in the Factoring Fee Calculator