The trade, in numbers
$50,000 at 1.25 over six months: $62,500 back, about $496 a business day. The same $50,000 at 1.35 over twelve months: $67,500 back, about $268 a day. The longer term costs $5,000 more and takes $228 a day less out of the account. Neither is wrong. One fits a business with even daily revenue and a strong balance; the other fits a business that is paid in lumps.
On an interest-bearing loan the shape is the same: a longer term is more months of interest, but if the product allows early repayment without penalty, you can take the longer term for the smaller payment and pay it off early if the cash is there — the best of both, and the reason to ask whether the product accrues or is fixed.
Why funders offer the short term first
It is less risk to them: their money is back sooner. Often it is quoted as the headline because the factor looks better. The question to ask is what the same amount costs over the longer term, and what the daily or weekly payment is on each. A funder will usually show both when asked. The one you were shown first is not the only one available.
How to pick
Start from the payment, not the factor. Look at your average daily balance; a common underwriting rule wants it at ten to fifteen times the daily debit. If the short term's payment breaks that rule, it is the wrong term whatever it saves in dollars, because one returned debit triggers fees, a default notice and a worse file for the next application. Take the longest term whose total cost you can accept and whose payment leaves the account comfortable, and repay early if the product rewards it.