Recourse vs non-recourse factoring (2026)
We may earn a fee if you sign up through our links. It never changes our rankings. How we make money
Quick answer
Key takeaways
- Recourse is typically cheaper; you carry the broker risk.
- Non-recourse typically covers broker credit failure, not short pays or claims.
- Watch the window: Phoenix’s recourse runs 60–120 days; OTR and Truckstop advertise no cutoff on non-recourse.
- Your factor credit-checks brokers either way, which is half the value.
Top picks
- Past 90 days
OTR Solutions
“True Non-Recourse”: assumes non-payment risk even after 90 days, no chargebacks. source
- No time limit
Truckstop Factoring
Non-recourse with no time limit and 30 days’ notice to leave. source
- Both programs
TBS Factoring
Takes the loss if a customer can’t pay for credit or funding reasons. source
How the two compare
| Recourse | Non-recourse | |
|---|---|---|
| Broker doesn’t pay (insolvent) | You buy it back | Factor takes the loss |
| Short pay or dispute | You | Usually you |
| Price | Lower (Phoenix) | Higher (Phoenix) |
| Window | Phoenix: 60–120 days | OTR: even after 90 days; Truckstop: no limit |
What each factor’s own page says
| Factor | Offers | What non-recourse covers | Source |
|---|---|---|---|
| OTR Solutions | Non-recourse | Non-payment even after 90 days; no chargebacks | source |
| Truckstop | Non-recourse | Broker non-payment, no time limit | source |
| TBS | Both | Customer’s own credit or funding issues | source |
| Phoenix Capital Group | Both | Bankruptcy or insolvency | source |
| FactorLoads | Both | Not detailed on page | source |
| DAT Outgo | Non-recourse | Not detailed on page | source |
Which should you choose?
Pick non-recourse if you’re new, take loads from small or unfamiliar brokers, or one unpaid load would sink your month. Pick recourse if you mostly haul for large, well-rated brokers and want the lower rate. Either way, ask the factor to define “non-payment” in writing.
Each factor, in detail
1. OTR Solutions
Non-recourse past 90 daysOTR says its True Non-Recourse program means it assumes the risk of non-payment even after 90 days, with no chargebacks.
Watch for: Once you factor a broker, later invoices from that broker must be factored until released.
Sources: otrsolutions.com · otrsolutions.com
2. Truckstop Factoring
No time limitTruckstop advertises non-recourse with no time limit, so you get paid even if the broker doesn’t pay, plus 30-day notice to leave.
Watch for: The broker must be factorable as decided by Truckstop.
Sources: truckstop.com
3. TBS Factoring
Both programsTBS says that with non-recourse, if a customer doesn’t pay because of its own credit or funding problems, TBS takes the loss. It also offers recourse.
Watch for: Read which non-payment reasons are covered.
Sources: tbsfactoring.com
4. Phoenix Capital Group
Clear buyback windowPhoenix offers both. Under recourse, customers are generally expected to pay within 60, 90 or even 120 days, after which you work it out with Phoenix. Non-recourse covers non-payment due to bankruptcy or insolvency.
Watch for: Non-recourse rates are higher than recourse, per Phoenix.
Sources: pcgfactoring.com
5. FactorLoads
Owner-operator focusFactorLoads offers recourse and non-recourse programs and says its non-recourse programs are aimed at owner-operators and small fleets.
Watch for: Rates are custom quotes.
Sources: portal.factorloads.com
6. CFX
Non-recourse optionCFX says its non-recourse options keep the bad debt with CFX if a broker you hauled for goes under, and it runs free broker credit checks before you take the load.
Watch for: CFX does not publish the time window or which loads qualify. Get the non-recourse terms in writing.
Sources: cfxfactor.com
Visit CFXFrequently asked questions
What is the difference between recourse and non-recourse factoring?
With recourse, if the broker doesn’t pay within the factor’s window, you buy back the invoice. With non-recourse, the factor takes the loss for covered reasons, usually the broker’s credit or insolvency.
Does non-recourse cover disputes?
Usually not. Phoenix, for example, says non-recourse covers non-payment due to bankruptcy or insolvency. Short pays, damage claims and missing paperwork generally stay with you. Read the definition in your contract.
Is recourse factoring cheaper?
Generally yes. Phoenix says its recourse rates are lower than non-recourse. Few factors publish both rates, so ask for each in writing.
How long is the recourse window?
Phoenix says customers are generally expected to pay within 60, 90 or even 120 days under recourse. OTR says its non-recourse holds even after 90 days, and Truckstop says no time limit.