Honest comparison of features, costs, and best use cases. Updated 2026.
| Factor | Factor Rate | APR (Annual Percentage Rate) |
|---|---|---|
| Definition | Multiplier (e.g., 1.30) | Annualized interest rate |
| Used By | MCAs, short-term loans | Term loans, lines of credit |
| Calculation | Loan × factor = payback | Time-based interest |
| Early Payoff Savings | NO savings | YES, save on interest |
| Transparency | Hides true APR | Standardized, comparable |
| Borrower Friendly | Less friendly | More friendly |
| Conversion Tip | 1.30 over 12mo ≈ 30% APR | Direct comparison |
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