Buy rate
The factor rate a funder offers a broker, before the broker adds their own margin.
The difference between the buy rate and what the merchant is quoted is the broker’s upsell, and it sits on top of any points paid by the funder. A buy rate of 1.28 sold at 1.38 means the merchant pays ten points of factor more than the funder required.
Why it matters to a broker
Several state regimes now regulate how broker compensation is disclosed. Upselling the factor without being able to speak to the total cost is increasingly a compliance question rather than a commercial one.
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