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Iowa MCA Defense Lawyers Business Debt Relief
Running a small business is difficult enough without the burden of overwhelming debt. If your Iowa business has become saddled with more loans and obligations than it can reasonably manage, you may be feeling hopeless about finding a solution. However, there are options available specifically designed to help business owners in your situation achieve financial freedom once again.
How We Can Help With Business Debt Relief
Our team at Delancey Street has extensive experience helping small business owners settle, restructure and eliminate burdensome business debt. We take an individualized approach to assessing your situation and developing a customized debt relief solution.With our assistance, you can:
- Settle debt for less than you owe
- Consolidate multiple loans into one manageable payment
- Restructure repayment terms that work for your business
- Rebuild your business credit score
- Learn better financial management practices
We will assign you a dedicated debt relief advisor to personally guide you through the process from start to finish. It begins with a free consultation to evaluate your unique situation.
Common Types of Business Debt We Can Help With
There are many different types of financing that businesses rely on which can spiral out of control. Some of the more common business debts we help clients settle or restructure include:
- Merchant cash advances (MCAs)
- Business lines of credit
- Equipment financing loans
- Commercial mortgages
- Business credit cards
Regardless of the specific type or types of debt currently plaguing your Iowa business, we have the knowledge and resources to create a path to financial freedom custom-tailored to your needs.
Iowa Merchant Cash Advance (MCA) Laws & Regulations
One major pain point for many small business owners in Iowa is merchant cash advances, also known as MCAs. While MCAs provide quick access to capital based on a business’ expected future credit card sales, they often come with extremely high effective interest rates and aggressive collection tactics when those sales don’t meet expectations.
- Iowa has no laws specifically regulating MCA lending practices or interest rates
- MCA agreements are not technically loans but rather the purchase of future receivables at a discount
- This allows MCA companies to skirt state laws capping interest rates on loans
- However, if the MCA was obtained fraudulently, that contract can be invalidated
- Unfair collection practices may also violate federal and state consumer protection laws
If you feel an Iowa MCA company misled you or is engaging in predatory collection actions, contact our legal network for a free case review. We can analyze the MCA agreement for weaknesses, negotiate with the funder where appropriate, and pursue legal action if warranted.
Legal Defenses Against Iowa MCA Companies
While MCA agreements are written to heavily favor the funder, there are defenses business owners can raise to invalidate or alter the terms of an exceptionally unfair or fraudulent MCA. Some potential legal arguments include:
Unconscionability
- Argues the contract terms are so unjust as to be legally unenforceable
- Applies when there was unequal bargaining power between parties
- Iowa courts have ruled unconscionable contracts void
Fraudulent Inducement
- Argues the business was intentionally misled into signing the MCA
- Grounds for rescinding the agreement
- Burden of proof is clear and convincing evidence
Breach of Contract
- Argues the MCA company violated terms of the agreement
- Most common claims involve failure to provide agreed upon amounts
- Could result in lower repayment or invalidation
RICO Violations
- Stands for Racketeer Influenced and Corrupt Organizations Act
- Makes it illegal to engage in racketeering activity while part of an enterprise
- Could apply if MCA business model relies on fraudulent or extortive conduct
The viability of any defense depends heavily on the specific facts involved in your case. Our network of attorneys can fully evaluate your situation and options for challenging an Iowa MCA contract.
Alternatives to Challenging Predatory MCAs
Rather than committing to an expensive, uphill legal battle, we often recommend small business owners explore alternatives better suited to freeing themselves from predatory MCA debt. Potential options include:
- Debt Settlement – We negotiate directly with the MCA provider to settle outstanding balances for less than the full amount owed. This avoids legal complexities while still reducing debt.
- Debt Consolidation – We can facilitate consolidating multiple business debts into a single, manageable loan with lower interest rates and flexible repayment terms tailored to your revenue streams.
- Chapter 11 Bankruptcy – While bankruptcy threatens significant damage to your business’ creditworthiness long-term, it does eliminate all qualifying outstanding debts in one fell swoop. Chapter 11 filings allow you to retain ownership of the business while developing a court-approved repayment plan.
- Sell the Business – As a last resort if the business is beyond saving, selling it allows you to pay off creditors and walk away to make a fresh start, even if it’s not an ideal outcome.
The path we recommend depends entirely on your specific goals and financial situation. By partnering with our dedicated advisors, we can objectively weigh all your options.
Our Business Debt Relief Process
If you decide moving forward with our business debt relief services makes sense, here is an overview of what you can expect: