Los Angeles Business Debt Settlement and Merchant Cash Advance Lawyers

Los Angeles Business Debt Settlement and Merchant Cash Advance Lawyers

Running a small business is tough. Between managing employees, keeping customers happy, and actually growing revenue, it’s easy to lose focus on the financial health of your company. And before you know it, you’ve racked up business debt through loans, credit cards, merchant cash advances or other financing.If this sounds familiar, you’re not alone. Thousands of LA business owners find themselves overwhelmed by debt at some point. But dealing with creditors and debt collectors is confusing, stressful and time consuming. That’s where working with attorneys who specialize in business debt relief can help.

How Can Business Debt Settlement Lawyers Assist?

Business debt settlement lawyers have extensive experience negotiating, settling and restructuring business debt. Their goal is to help you:

  • Get creditors to stop collections activities like threatening phone calls or lawsuits
  • Lower your total payoff amount through lump sum settlements or payment plans
  • Consolidate multiple debts into one monthly payment
  • Improve cash flow by reducing required payments
  • Avoid business assets being put at risk of seizure or foreclosure
  • Prevent personal guarantees from being enforced against your home or other assets
  • Ultimately achieve financial stability and peace of mind

Unlike debt settlement companies that take a one-size-fits-all approach, lawyers craft customized debt relief solutions tailored to your unique situation. From small retail shops and restaurants to professional practices and online businesses, they assist companies across all industries and revenue sizes.And while debt settlement firms focus solely on negotiating payoffs, lawyers also provide counsel on using bankruptcy, legal defenses, compliance requirements, tax implications and other aspects of business debt relief. This allows them to pursue every potential avenue for the most favorable outcome in your specific circumstances.

Key Laws & Legal Protections

When it comes to business debt, there are a variety of laws and legal protections that may apply to your situation:

  • Fair Debt Collection Practices Act (FDCPA) – This federal law limits what third-party debt collectors can do when attempting to collect, such as restricting late night calls or false threats of legal action. Violations may entitle you to statutory damages.
  • Rosenthal Fair Debt Collection Practices Act – California’s version of the FDCPA that provides additional consumer rights and remedies under state law.
  • Telephone Consumer Protection Act (TCPA) – Prohibits using auto dialers, prerecorded messages or text messages without prior consent, with damages of $500 to $1500 per violation.
  • Statute of limitations – Debt contracts have time limits on when legal action can be taken to collect, generally 3-6 years in California. Expired debt cannot be sued upon or reported to credit agencies.
  • Usury laws – Interest rate caps and loan fee limits that apply to some business financing like merchant cash advances. Violations can lead to debt being invalidated.
  • Lender liability laws – Creditors have a duty of good faith and fair dealing that if breached, can serve as basis to fight enforcement. Grounds include deception, harassment, unreasonable terms, etc.
  • Bankruptcy – Federal court process that stops collections and wipes clear or restructures eligible business debt under Chapters 7, 11, 12 and 13.

Reputable attorneys will evaluate if any of these apply and can be used to defend against creditors, lower balances or overturn debt completely. Having an advocate on your side levels the playing field when dealing with aggressive collectors attempting to extract payments.

What Does The Process Look Like?

Here is an overview of what to expect when working with a business debt relief law firm:

1. Initial Consultation

You’ll have an intro call, video chat or in-office meeting to discuss your situation, debt breakdown, financials, goals and options. Attorneys will ask questions to understand the full picture, while also educating you on the process and possibilities.There is no obligation to engage further services, so it’s a risk-free way to explore whether settlement or other legal avenues make sense for your circumstances.

2. Retainer Agreement

If both parties decide to work together, you’ll enter into a written fee agreement outlining the legal services, timeline, deliverables and attorney costs for representation.Fees often involve a small upfront retainer, with the bulk of charges contingent on successfully reducing your debt burden. This ties the law firm’s compensation to results achieved for your business.

3. Information Gathering

Your lawyer will request documentation needed to assess defenses, negotiate from a position of strength and craft arguments leaning favorably towards your business. Items often include:

  • Debt contracts, statements, correspondence with creditors
  • Company financial statements, tax returns, bank records
  • Assets/liabilities, expenses, revenue data
  • Details on business structure, ownership, operations

Providing complete details allows attorneys to build the most compelling case possible when dealing with creditors.

4. Negotiations & Settlements

Leveraging their expertise and your documentation, lawyers will contact creditors to introduce themselves as your legal representative. Collectors usually become more cooperative facing attorneys threatening litigation.Your lawyer will negotiate lump-sum payoffs or payment plans of 40-60% less than balances owed. This may happen through back-and-forth discussions or more structured settlement conferences.

5. Debt Relief Finalization

As deals are struck, attorneys formalize agreements in writing detailing payment terms, reporting to credit bureaus, releases of liability and other settlement specifics.Funds are placed in attorney escrow accounts to facilitate payments, adding a layer of accountability and security for all parties.

6. Case Closure

Once settlements are paid and your business is debt-free, attorneys will provide closing letters confirming zero balances owed and releasing you from further claims or collections.You’ll receive a final bill for the lawyer’s services based on debts reduced, then can move forward unburdened by the past debts.

Finding The Right Attorney

With something as crucial as business debt relief, finding an attorney you trust is key. Here are some tips on identifying reputable lawyers:

  • Industry specialization – Seek out firms focusing specifically on business debt relief over general practitioners. Their niche expertise translates to better outcomes.
  • Fee transparency – Beware of lawyers charging large upfront fees before doing anything. Opt for contingency-based pricing tied directly to debt reduction results.
  • Client reviews – Check sites like Google, Facebook and Avvo to confirm positive feedback from past clients on their experiences.
  • Responsive communication – You want an attorney who answers questions promptly, keeps you updated and is easily accessible.
  • Track record – Ask about their background in business debt cases, settlement rates achieved, and case examples similar to your circumstances.

Alternatives To Attorney Debt Relief

While legal help can be invaluable, it also comes with higher costs. Other options like debt settlement companies charge lower fees, but you sacrifice personalized service, legal protections and having an advocate acting strictly in your business‘ best interest.Attempting to negotiate debt yourself is very difficult without expertise, not to mention the investment of significant time and energy better spent operating your business.Non-profit credit counseling provides free budgeting and advice resources, but have limited capacity to actually settle balances. They also lack specialized small business debt experience.Bankruptcy is another route that essentially erases debt through court process rather than settlements. The tradeoffs are legal complexity, damage to business credit ratings, and public records showing insolvency.

For most small business owners, partnering with a debt relief attorney offers the right blend of debt reduction capabilities, customization and guidance needed to overcome financial challenges.

Delancey Street – Small Business Debt Relief Experts

Delancey Street has extensive experience assisting LA business owners struggling with debt. Our local attorneys have negotiated over $250 million in small business debt relief through settlements and other arrangements.We handle matters related to:

  • Business Loans & Lines of Credit
  • Merchant Cash Advances
  • Commercial Mortgages & Equipment Leasing
  • Business Credit Cards & Accounts Payable
  • Tax Debt Negotiation & Resolution
  • And more…

Delancey Street takes pride in offering white-glove, boutique-style service with compassion and discretion. There is never any pressure or obligations when engaging us for help.Our simple 3 step process is as follows:

1. Free Debt AssessmentSchedule a no-cost consultation with one of our small business debt specialists. We’ll review your situation, provide options, give recommendations and address all questions without pushiness.

2. Dedicated SpecialistIf you decide to move forward, you‘ll be matched with a personal debt relief advisor who manages your case from start to finish. Think of them as your go-to point person.

3. Customized Action PlanTogether with your specialist, we’ll map out a tailored game plan based on your specific debt, budget, savings goals and ideal timeline for resolution.

What do you think?

What to read next