Madison MCA Defense Lawyers Business Debt Relief

MCA Defense Lawyers Business Debt Settlement

Merchant cash advance (MCA) loans have become an increasingly popular way for small businesses to access quick financing. However, some MCA lenders engage in predatory practices that can leave business owners saddled with crushing debt. If you are struggling with MCA debt, working with an experienced business debt settlement lawyer can help you take control of the situation.

How MCA Loans Work

A merchant cash advance provides a business with a lump sum of capital in exchange for a percentage of future credit card sales. It is not technically considered a loan, so MCA companies can skirt consumer protection laws that regulate loan products.Here’s a quick rundown of how MCAs work:

  • No Credit Checks – MCA companies do not look at personal or business credit scores to approve financing. This allows many companies that would not qualify for a bank loan to get funding.
  • Quick Funding – Businesses can often access MCA funds in as little as 24-48 hours. The application process is simple and funding is fast.
  • Fixed Daily Payments – The business agrees to pay back a fixed amount from their credit card sales every day until the full MCA amount plus fees and interest is repaid. Payments are taken automatically as a percentage of daily batches.
  • Higher Costs – While MCAs provide quick and easy financing, they come at a steep price. The equivalent APR on an MCA is typically between 70% – 300%.

Predatory MCA Practices

While MCAs fill a need for financing for struggling companies, some MCA providers use aggressive and predatory tactics:

  • Deceptive Marketing – MCA companies promote themselves as cash advance providers rather than lenders. This allows them to avoid transparency laws governing loan products.
  • Hidden Fees – Additional fees are often buried in fine print MCA contracts. These can include application fees, origination charges, and more.
  • Overfunding – Some MCA providers intentionally issue loans larger than a business can reasonably afford to pay back. This ensures they will default and the MCA company can collect large penalties.
  • Aggressive Collections – Tactics like daily auto debits from merchant accounts, threats to contact customers about debts, and filing confessions of judgement are commonly used to collect on MCAs.

These practices catch many small businesses off guard. While the appeal of quick and easy financing is strong, predatory MCAs can quickly spiral out of control.

Fighting Back Against Abusive MCAs

If you have been victimized by an abusive MCA provider, working with an attorney experienced in MCA laws can help you regain control. There are a number of legal arguments that can be made to challenge predatory MCA arrangements:

  • Usury Laws – Interest rates on MCAs often violate state laws regarding allowable interest charges on loans. This can invalidate the agreement.
  • Unconscionability – If an MCA contract is deemed unjust, overly harsh, or one-sided by a court, it may be struck down as unconscionable.
  • RICO Laws – Attorneys can argue that deceptive marketing, overfunding, and aggressive collections violate racketeering laws. This allows for additional penalties against MCA companies.
  • FDCPA Violations – Debt collectors used by MCA providers often violate Fair Debt Collection Practices by threatening litigation or criminal charges. These violations can invalidate debts.
  • Bankruptcy – Filing for bankruptcy stops collections activity and brings all debts under court supervision for possible renegotiation or discharge.

Our Legal Team Can Help

Here at Delancey Street, our experienced attorneys offer professional support to small business owners struggling with predatory MCA loans. We provide free consultations to review your situation and provide tailored advice.Potential options we may discuss include:

  • Negotiating with MCA providers for reduced settlements
  • Challenging loan terms in court
  • Defending against aggressive collections practices
  • Structuring payment plans
  • Filing complaints with regulators
  • Exploring bankruptcy to eliminate debts

Our team understands the challenges faced by small business owners and treat every client with compassion. Contact us today to schedule your free consultation. Taking action quickly gives you the best chance of resolving MCA debts and saving your business.

4 Reasons to Work With a Business Debt Settlement Lawyer

Fighting back against predatory MCA loans can feel intimidating. MCA companies rely on superior legal resources and aggressive tactics to collect debts. Having an experienced business debt lawyer on your side helps even the playing field.

1. Expertise Navigating Complex Laws

Business attorneys understand the patchwork of state and federal laws governing lending practices. We identify potential violations of usury caps, fee disclosures, collections regulations, and more that can invalidate debts. Our familiarity with these complex legal frameworks informs potential strategies.

2. Knowledge of MCA Industry Tactics

Attorneys with experience battling merchant cash advance companies have seen their playbook firsthand. We know their pressure points and can advise clients on responding to harassment from collectors. Understanding common MCA tactics also informs courtroom arguments to protect client interests.

3. Objective Guidance Weighing All Options

Business owners facing MCA debts often feel overwhelmed weighing choices with serious financial implications. An attorney provides impartial guidance based on your unique situation. We outline pros/cons of strategies like bankruptcy, litigation, or settlement negotiations to make the best decision.

4. Ongoing Support During Legal Fights

Court cases challenging abusive MCA arrangements can involve drawn-out legal fights. Attorneys coordinate filings, gather evidence, represent you in hearings, file complaints with regulators, and more. We handle the heavy lifting so you can focus on running your business.

Questions a Business Debt Settlement Lawyer Can Answer

Wondering if working with a business debt attorney is the right choice? During your free consultation, here are some of the common questions we can answer:What are my options for negotiating MCA debt relief?There are several leverage points we may use to push for reduced settlements or alternate repayment terms more favorable to your business. Strategies can include highlighting legal violations by MCA providers, filing complaints, threatening litigation, or asserting rights in bankruptcy court.What fees and interest rates are legally allowed on business financing in my state?Regulations regarding lending disclosures, usury caps on interest rates, and allowable fees vary widely across different states. We clarify the laws impacting MCA loans where your business is located to identify potential violations.Is my personal credit or assets at risk from this business debt?Whether owners face personal liability depends on the original MCA agreement terms and varies by state. We examine the specific contract provisions and applicable laws to advise you on potential threats to your personal finances.Do I need to continue making daily payments while contesting my MCA debt?There are several legal actions that can pause collections activity against your business. We discuss options like asserting violations of state lending laws, filing for injunctive relief, or submitting disputes to regulators. Each approach impacts your repayment obligations differently.What information should I collect to strengthen my case against the MCA provider?Documenting the timeline of your MCA agreement, keeping records of communications with collectors, and gathering proof of aggressive collections attempts strengthens arguments of predatory lending. We provide guidance on compiling this critical evidence.Could bankruptcy help eliminate my business debts?For some businesses facing unsustainable debts, bankruptcy may provide the clean slate needed to continue operations. We provide clear advice about qualifying for Chapter 7 or Chapter 11 based on your specific circumstances.What happens if I simply stop making payments on the MCA loan?Understanding potential consequences of defaulting is critical when weighing options. Attorneys outline realistic outcomes if you stop payments like collections harassment, lawsuits, judgments against your business, or even asset seizures.

Key Takeaways

Predatory merchant cash advance loans push many small businesses to the financial brink. Seeking help from professionals experienced fighting against abusive MCA tactics can literally make or break a company’s survival.At Delancey Street, our legal team provides customized guidance and ongoing support to business owners. Scheduling a free consultation is the first step in taking control of your situation.We discuss your strategic options, identify potential violations of lending laws, and outline pros and cons of different debt relief approaches. Our objective is negotiating reduced settlements so you can maintain business operations.Don’t struggle with oppressive MCA debts alone. The sooner you contact us, the faster we can start protecting your interests.

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