From the Factoring Contract to the Factoring Policy
The factoring contract, also known as financial factoring contract, is a type of contract with notarial intervention that is processed in our online and physical notary office. The resulting document is called a factoring policy.
As Notaries in Policies in Barcelona specialised in this field, we want to explain all the information related to online and in-person factoring contracts before a Notary, what they are, how they are made, their requirements and more.
You should know that you can sign your policy in person at JLA Notarios – Notaria Barcelona and that you can also sign your policy before a Notary completely digitally, through the Citizen's Notarial Portal. This possibility of digital signing of notarial policies was established in law 11/2023, so if you have any questions, please do not hesitate to contact us.
What is Factoring? What is a factoring contract?
The factoring contract is a complex document that serves as a financing method for medium and small companies (such as SMEs) as it provides them with liquidity and time savings. In it, a credit institution manages the outstanding invoices of a company to take care of them in exchange for providing immediate liquidity.
Thus, three parties are involved in a factoring contract: the debtor, who is the one who must pay for the products or services sold, the client company, which receives management services for outstanding invoices, and the factoring company that provides the payment.
Often the credit institution is also known as the "factoring company", "factor" or "factoring society" while the company that sells the accounts is referred to as the "client company".
What is the purpose of a factoring contract and what is it used for, with an example?
As we were saying, the factoring contract allows a company to receive immediate liquidity to facilitate its business development. If a company sells a product to another and has to wait 1 month to receive payment, the factoring company or credit institution would pay the agreed amount of money (for example, an equivalent to 90% of the invoice). Then, this financial institution would make its profit by charging the total amount of the invoice, that is, 100% from the debtor company that had the payment for the product pending. However, there are different types of factoring contracts that we will see later.
What is factoring?
It should also be taken into account that the factoring company obtains a "factorage" commission on the invoice it applies to the company that assigns the invoices for their management, administration and assumption of risk. This may vary depending on the billing volume, the type of factoring or the payment and risk, but it usually ranges between 0.5 and 3% of the value of the invoices, although everything depends on the market and the situation of the company requesting these services.
What are the advantages and disadvantages of the factoring contract?
In summary, factoring offers different advantages such as better liquidity for companies, reduces the risk of non-payment and administrative work, improves the financial balance, and allows access to financing without incurring debt.
Among the disadvantages are the commissions and fees applied by factoring companies or the risk of weakening the close relationship we maintain with our company's clients.
Types of Factoring and Financial Factoring Contracts
There are different types of financial factoring contracts which we detail below.
Factoring with outright assignment of receivables is divided into factoring with recourse and without recourse:
What is a recourse factoring contract?
The assignment of receivables acquired by the factoring company takes place: it includes a "pro solvendo" clause in which, if the debtor defaults, the factoring company recovers its credit.
What is a non-recourse factoring contract?
In this type of factoring, the factoring company acquires the credits from the company and assumes the risk of non-payment by the debtor. The commissions are usually higher.
Factoring with assignment of receivables in collection commission
The company that sells the accounts awaits the factoring company to manage the collection from the debtor company.
Notified and non-notified factoring
On the other hand, we find:
- Notified factoring: in notified factoring, the management and communication carried out with the debtor company (who purchased goods or services) to report on the assignment of invoices is described.
- Unnotified factoring: in this case, no communication is made to the debtor company.
Payment in factoring: what is invoicing through financial factoring like?
There are several forms of payment in factoring, for example, payment on collection, with payment on collection with a deadline, with payment at maturity or with payment on an established date.
Regarding financing, it can be with or without advance payment. This means that the company assigning the credits can receive advances on assigned credits with interest for advancing amounts.
What is national and international factoring?
On the other hand, we can distinguish between national factoring, when the 3 parties involved in the operation reside in the same country, whereas international factoring occurs when the client and debtor reside in different countries. The latter is known as export factoring.
The Role of the Notary in the Factoring Policy
Once an agreement has been reached, the factoring policy must be signed before a Notary. The Notary plays a fundamental role and is involved by granting legal validity, certifying the signature and consent of the operation so that the content is fully arranged according to the law.
Likewise, it facilitates enforcement in the event of non-compliance with the agreed terms through judicial means, as the notarised factoring policy prevents challenges before a court and reduces the risk of litigation.
The figure of the Notary plays a fundamental role in this process as they will guide and assist you at all times, resolving your doubts and advising you on the best options for you. You can choose the Notary you wish.
Contact us for your enquiry wherever you are through our Online Notaries service. The intervention and signing of the factoring policy before a Notary will be carried out effectively.
Documents required to sign a factoring policy before a Notary
The following will be required:
- Identification documents of the persons signing the factoring agreement
- Documents proving the existence of the involved companies and their representation. This can be replaced by obtaining commercial information from the notary.
- Policy with the conditions of the factoring.
How much does a notarial factoring policy cost?
The fees for a factoring contract at a notary are fixed and regulated in the notarial tariff. The price of notarial acts is regulated by the Government and complies with the regulatory framework of the NOTARIAL TARIFF (RD 1426/1989, of 17 November, regulating the Notaries’ Tariff).
The fees for a factoring contract at a notary are regulated in the notarial tariff. The cost of the policy depends, among other aspects, on the amount of the debt and the number of pages of the policy.
If you wish to receive a detailed quote, we invite you to contact us directly through the channel that suits you best. You can do so via the contact form on the main page of this website, through the contact section found in the footer of the website, using the WhatsApp shortcut at the bottom right of this page, by sending an email to bcn@jlanotarios.com or by calling us on 93 159 17 62.
As a guideline, we can inform you that, according to the current regulatory framework, the usual price for the formalisation before a Notary of a FACTORING POLICY for an amount of €50,000 with a maturity of less than 6 months is approximately €250, including VAT.
This indicative price is calculated for a document of usual content granted by a company.
JLA Notarios, Factoring policy in Barcelona
At JLA Notarios we are proud to offer secure and efficient solutions for financial operations. Please get in touch to obtain more information about the factoring policy and receive personalised advice with a swift and secure process where we offer solutions tailored to your specific needs.
We would be delighted to welcome you to help formalise your notarial factoring contract. You can visit us in person or make an enquiry with our Notaries in Barcelona digitally through the online notary service. If you need a quote, you can also book an appointment by emailing polizas@jlanotarios.com. At JLA Notarios we specialise in notarial policies in Barcelona and we will be pleased to assist you.
By your side in the moments that matter
Inheritance and wills
The moment of granting a will, making a declaration of heirs or formalising an inheritance are very important moments in people's lives.
At JLA Notarios we offer services related to succession law, both to arrange your succession and to distribute an inheritance, guaranteeing the best advice tailored to your particular needs and the study of the tax implications of each case. At no time do we neglect the human factor, even offering home notary services if necessary.
Contracts and property law
Over the course of our lives, we carry out important actions, such as buying a home, declaring a new-build, lifetime gifting to our children or ending partnerships, among many others.
At JLA Notarios we are experts in property and contract law and buying and selling property. We guide our clients, analysing each particular issue and always considering the tax burden of each transaction.
In addition, some of our notarial services can be performed online, so we can assist you from anywhere in Spain. Contact us to declare a new-build or a commonhold ownership structure online.
Mortgage
Taking out a mortgage is one of the biggest moments for anyone. Just think of the fees and interest you may have to pay for much of your life. So it is essential to have a trusted notary to help you understand what you are signing, explaining the tricky legal terms and their future consequences in simple words, to provide transparency and protect our clients.
At JLA Notarios we are aware of the importance of giving complete and understandable information to people about to sign a mortgage, novation or subrogation. We also advise and guide you on your future mortgage cancellation.
Loan agreements and credit facilities
Individuals and companies often need money to fulfil their dreams or projects. This can be obtained by taking out a loan or credit facility with your bank. When you sign, it is essential to understand the details properly to avoid future surprises.
JLA Notarios can be your trusted notary office, giving you accurate advice on loan contracts, providing a very agile and specialised service for processing loan contracts.
Bear in mind that from 9 November 2023, you will be able to sign your loan contracts from anywhere in Spain electronically by videoconference with JLA Notarios, saving you time and money. Do not hesitate to contact us to find out more about the notary office’s services in order to sign a loan contract online or sign a credit facility online.
Companies
Without entrepreneurship there is no future, so it is of vital importance to support our businesspeople and entrepreneurs.
At JLA Notaries we are familiar with companies’ life cycle, which enables us to provide legal assistance for companies in their different stages, whether incorporation, modifications of their articles of association, changes of director, share sales and purchases, capital increases and reductions, dissolution and closure, and everything related to commercial matters.
Powers of attorney
There are moments in life when a person needs to delegate. The law provides a tool for this: powers of attorney. Though a power of attorney, one person allows another person to act on their behalf.
At JLA Notarios we make sure that you understand the significance and risks of delegating or revoking powers of attorney, from a special power of attorney or power of attorney for lawsuits, to general powers of attorney or preventive powers of attorney for cases of incapacity.
We provide an agile service to sign powers of attorney. You can take your copy away immediately, saving you unnecessary trips, and from 9 November 2023 our clients will be able to sign all powers of attorney that are not general or preventive by videoconference through our digital notary office.
Family affairs
A prosperous society is based on the family and its protection. Family Law provides you with the tools to protect your family and its members, so its foundations are solid and its purposes can be achieved.
At JLA Notarios we provide legal advice on marriage or civil partnerships; property aspects of the family through marriage contracts or civil partnership contracts; the moments when the family relationship is ended, in cases such as divorce or separation; and protection of vulnerable people, such as minors or people with modified capacity, through deeds of appointment of guardians or executors or creation of protected assets. We do all of this in a way that makes everyone involved feel equally supported and secure.
Certifications and authentications
It is common knowledge that notaries attest. That important and simple action can guarantee things of vital importance, such as ensuring that the signature on a document is authentic or certifying that a copy of a document matches the original.
At JLA Notarios we will help you to certify a document or notarise a signature in accordance with the law and tailored to your specific needs.
In addition, these notarial procedures can be carried out conveniently through electronic means from 9 November 2023.
Minutes
How many times have you wanted to leave a record of an event, of a statement, of the condition in which an object is found, or notify someone of any matter. To provide a solution to these issues, the Law provides us with notarial records.
At JLA Notarios we adapt to you, reflecting in the record what you require and carrying out the notifications and requests that you demand.
Oath of Nationality
Behind every nationality oath there is a story of overcoming, sacrifice and waiting.
At JLA Notarios we understand what this moment means and offer an empathetic, agile and quick service, advising beyond the oath itself, anticipating the future requirements that the new Spanish citizen will need.
We are your reference Notary to carry out the nationality oath before a Notary in Barcelona.
Apostille of the hague convention
Globalisation enables the free movement of people and documents of all kinds. How can you guarantee that a document has been officially issued? With an apostille of the Hague Convention.
JLA Notarios can obtain an apostille for all documents executed before us so they are valid and recognised abroad. We do this transparently and save you all the bureaucratic procedures involved.
Tax and registry procedures
Tax bureaucracy can cause a lot of headaches.
So JLA Notarios offers its clients the possibility of assessing and paying the many different taxes by the executing deeds and carrying out other procedures before the notary. We can also file them with the Land or Companies Registry so you do not have to concern yourself with it and can spend your time on the things that matter. We support you from start to finish.
Inheritance and wills
The moment of granting a will, making a declaration of heirs or formalising an inheritance are very important moments in people's lives.
At JLA Notarios we offer services related to succession law, both to arrange your succession and to distribute an inheritance, guaranteeing the best advice tailored to your particular needs and the study of the tax implications of each case. At no time do we neglect the human factor, even offering home notary services if necessary.
Contracts and property law
Over the course of our lives, we carry out important actions, such as buying a home, declaring a new-build, lifetime gifting to our children or ending partnerships, among many others.
At JLA Notarios we are experts in property and contract law and buying and selling property. We guide our clients, analysing each particular issue and always considering the tax burden of each transaction.
In addition, some of our notarial services can be performed online, so we can assist you from anywhere in Spain. Contact us to declare a new-build or a commonhold ownership structure online.
Mortgage
Taking out a mortgage is one of the biggest moments for anyone. Just think of the fees and interest you may have to pay for much of your life. So it is essential to have a trusted notary to help you understand what you are signing, explaining the tricky legal terms and their future consequences in simple words, to provide transparency and protect our clients.
At JLA Notarios we are aware of the importance of giving complete and understandable information to people about to sign a mortgage, novation or subrogation. We also advise and guide you on your future mortgage cancellation.
Loan agreements and credit facilities
Individuals and companies often need money to fulfil their dreams or projects. This can be obtained by taking out a loan or credit facility with your bank. When you sign, it is essential to understand the details properly to avoid future surprises.
JLA Notarios can be your trusted notary office, giving you accurate advice on loan contracts, providing a very agile and specialised service for processing loan contracts.
Bear in mind that from 9 November 2023, you will be able to sign your loan contracts from anywhere in Spain electronically by videoconference with JLA Notarios, saving you time and money. Do not hesitate to contact us to find out more about the notary office’s services in order to sign a loan contract online or sign a credit facility online.
Companies
Without entrepreneurship there is no future, so it is of vital importance to support our businesspeople and entrepreneurs.
At JLA Notaries we are familiar with companies’ life cycle, which enables us to provide legal assistance for companies in their different stages, whether incorporation, modifications of their articles of association, changes of director, share sales and purchases, capital increases and reductions, dissolution and closure, and everything related to commercial matters.
Powers of attorney
There are moments in life when a person needs to delegate. The law provides a tool for this: powers of attorney. Though a power of attorney, one person allows another person to act on their behalf.
At JLA Notarios we make sure that you understand the significance and risks of delegating or revoking powers of attorney, from a special power of attorney or power of attorney for lawsuits, to general powers of attorney or preventive powers of attorney for cases of incapacity.
We provide an agile service to sign powers of attorney. You can take your copy away immediately, saving you unnecessary trips, and from 9 November 2023 our clients will be able to sign all powers of attorney that are not general or preventive by videoconference through our digital notary office.
Family affairs
A prosperous society is based on the family and its protection. Family Law provides you with the tools to protect your family and its members, so its foundations are solid and its purposes can be achieved.
At JLA Notarios we provide legal advice on marriage or civil partnerships; property aspects of the family through marriage contracts or civil partnership contracts; the moments when the family relationship is ended, in cases such as divorce or separation; and protection of vulnerable people, such as minors or people with modified capacity, through deeds of appointment of guardians or executors or creation of protected assets. We do all of this in a way that makes everyone involved feel equally supported and secure.
Certifications and authentications
It is common knowledge that notaries attest. That important and simple action can guarantee things of vital importance, such as ensuring that the signature on a document is authentic or certifying that a copy of a document matches the original.
At JLA Notarios we will help you to certify a document or notarise a signature in accordance with the law and tailored to your specific needs.
In addition, these notarial procedures can be carried out conveniently through electronic means from 9 November 2023.
Minutes
How many times have you wanted to leave a record of an event, of a statement, of the condition in which an object is found, or notify someone of any matter. To provide a solution to these issues, the Law provides us with notarial records.
At JLA Notarios we adapt to you, reflecting in the record what you require and carrying out the notifications and requests that you demand.
Oath of Nationality
Behind every nationality oath there is a story of overcoming, sacrifice and waiting.
At JLA Notarios we understand what this moment means and offer an empathetic, agile and quick service, advising beyond the oath itself, anticipating the future requirements that the new Spanish citizen will need.
We are your reference Notary to carry out the nationality oath before a Notary in Barcelona.
Apostille of the hague convention
Globalisation enables the free movement of people and documents of all kinds. How can you guarantee that a document has been officially issued? With an apostille of the Hague Convention.
JLA Notarios can obtain an apostille for all documents executed before us so they are valid and recognised abroad. We do this transparently and save you all the bureaucratic procedures involved.
Tax and registry procedures
Tax bureaucracy can cause a lot of headaches.
So JLA Notarios offers its clients the possibility of assessing and paying the many different taxes by the executing deeds and carrying out other procedures before the notary. We can also file them with the Land or Companies Registry so you do not have to concern yourself with it and can spend your time on the things that matter. We support you from start to finish.
