Bill & Hold

Last Updated: Jun 6, 2019

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A bill & hold is a type of sales arrangement in which the buyer purchases goods but the seller maintains physical possession until a later ship date. The buyer and seller typically agree upon certain conditions that must be met before ownership transfers. This can lead to the buyer recording inventory they do not yet possess or premature revenue recognition on the part of the seller. Merchandise that is billed and held is risky from a lending perspective and requires proper insurance and a signed agreement between the buyer and seller. Even still, bill & hold items are oftentimes considered ineligible.

A bill & hold is a type of sales arrangement in which the buyer purchases goods but the seller maintains physical possession until a later ship date. The buyer and seller typically agree upon certain conditions that must be met before ownership transfers. This can lead to the buyer recording inventory they do not yet possess or premature revenue recognition on the part of the seller. Merchandise that is billed and held is risky from a lending perspective and requires proper insurance and a signed agreement between the buyer and seller. Even still, bill & hold items are oftentimes considered ineligible.