Trucking Terms Guide

Factoring / Paperwork

Notice of Assignment in trucking

Short answer: A notice telling the broker or shipper to pay the factoring company instead of the carrier.

Plain-English explanation

A notice of assignment (NOA) is a document sent by a factoring company to the carrier's customers — typically brokers — informing them that the carrier has assigned their invoices to the factor, and that all payments for those invoices must be sent directly to the factoring company rather than to the carrier. Once an NOA is in place, brokers pay the factor and the carrier receives the advance from the factor.

Factoring terms belong next to the invoice, POD, broker approval, reserve detail, and factoring agreement. A small wording difference can change the funding timeline.

Why it matters in trucking

An NOA changes where money flows. If a broker pays the carrier directly after an NOA is in place — because they did not receive it or overlooked it — the factor may still hold the carrier responsible for repaying the advance while the carrier tries to recover the misdirected payment from the broker. Carriers switching factoring companies need to be especially careful about managing NOAs during the transition.

The business risk is usually hidden in timing: when the factor advances money, what happens if the debtor does not pay, and which documents must match.

Example in real use

A carrier signs a factoring agreement and the factoring company sends NOAs to 15 approved brokers on the carrier's active lane list. Two weeks later, a broker pays the carrier directly on an old invoice, not realizing the NOA was on file. The factor contacts the carrier to resolve the misdirected payment — the carrier must either return the payment or coordinate repayment with the broker.

Common mistakes or confusion

  • Assuming brokers automatically know to pay the factor — the NOA must be on file and the broker must confirm receipt for the redirection to be effective.
  • Not canceling old NOAs with prior factoring companies when switching factors, which can create a situation where two factors have active claims on the same broker payment.
  • Accepting direct payment from a broker after an NOA is in place without flagging it to the factoring company, which can trigger a chargeback or contract dispute.

Related terms

UCC Filing A public financing statement that may show a secured interest in business receivables or assets. Schedule of Accounts A list of invoices submitted to a factor for purchase or funding. Freight Factoring Selling freight invoices to a factoring company for faster payment, minus agreed fees. Invoice Factoring A financing method where a business sells invoices for earlier cash flow. Recourse Factoring Factoring where the carrier may be responsible if the customer does not pay. Non-Recourse Factoring Factoring that may shift certain nonpayment risk to the factor, subject to contract limits.

Related guides

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Sources and last updated

Factoring definitions describe general industry terms and contract structures. Specific rights and obligations depend on the factoring agreement in effect. See the sources page.

Last updated: 2026-05-10