Glossary & Definitions

Every industry protects itself with vocabulary, and commercial financing is worse than most. Factor rate, holdback, buy rate, stips, first position, reconciliation, UCC-1, ACH remittance: none of these words is difficult, but agreements are written in them, and an owner who signs a document they could not fully read has already given away their best negotiating position.

The glossary defines each term in a few hundred plain-English words: what it means, where it shows up in a real offer or agreement, and what to check when you see it there. The entries stay short on purpose. When a term deserves a full article, the entry links to one, and every definition links to the related terms you will meet in the same paragraph of the same agreement.

Two entries are worth calling out as the ones that save people real money. Factor rate, because it is not an interest rate, cannot be compared to an APR, and is the single most misunderstood number in this industry. And position, because what an advance costs has a great deal to do with what is already sitting in front of it. Read those two before you read any offer, and read the rest as the paperwork in front of you makes them relevant.