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MCA Defense Lawyers Provide Expert Assistance With Merchant Cash Advance Debt

Merchant cash advances (MCAs) can provide quick access to capital for small businesses. However, the terms of MCA agreements are often predatory, with exorbitant interest rates and aggressive collection tactics. If your business is struggling with MCA debt, specialized legal defense may be needed.

How MCAs Work and Why They Can Be Problematic

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 a loan, so MCA companies can bypass state laws capping interest rates. However, the equivalent annualized interest rate often exceeds 100%.While MCAs provide fast money with minimal eligibility requirements, the payback can quickly become unmanageable. Many businesses see their payments consume 30-50% of credit card receipts. The arbitrarily high payments combined with personal guarantees, daily debits, and lack of regulation have caused financial ruin for countless small business owners.

Legal Defenses Against Abusive MCA Companies

If you feel trapped in a cycle of endless MCA debt, specialized legal assistance can be invaluable. Experienced attorneys understand the MCA business model inside and out. They can build a defense against unfair contracts and aggressive collection tactics. Potential strategies include:

  • Contesting the MCA agreement as a disguised loan – In many states, lending laws cap interest rates at less than 30% APR. If an MCA contract is deemed an illegal loan under state law, the agreement can potentially be invalidated.
  • Challenging unfair contract terms – MCA contracts often contain one-sided provisions allowing random payment increases, personal liability even after business assets are exhausted, and other lender-friendly terms that may be unconscionable.
  • Disputing breach of contract by the MCA company – If the MCA provider fails to uphold their end of the bargain, it may nullify their ability to collect payments. Common issues include failure to fully disclose fees, misrepresenting business practices, or even fraud.
  • Asserting affirmative defenses – Situations like financial distress, lack of consideration, fraud in the inducement, and more may excuse further performance of the contract.
  • Negotiating settlement agreements – Experienced attorneys can leverage defenses to negotiate a lump-sum settlement for less than the full payoff amount. This can free the business from the MCA’s grip.

How a Specialized MCA Defense Law Firm Can Help

Navigating MCA contract disputes requires an attorney well-versed in this unique area. At Delancey Street Law, our lawyers focus specifically on defending small businesses from MCA abuse. We understand the predatory nature of the MCA industry and how to build strong legal arguments against their suspect practices.Our firm takes an aggressive yet strategic approach. We thoroughly analyze the MCA agreement to spot weaknesses and identify potential defenses. We then put pressure on the MCA company by presenting credible legal threats. Many cases end in a favorable settlement that reduces or eliminates the balance owed.If settlement talks fail, we have the experience to take the matter to court. Our lawyers are intimately familiar with arguing MCA cases before judges and can cite real-world examples of favorable rulings against MCA companies. We will fight tenaciously to invalidate questionable contracts and stop unlawful collection activities.

See also  Atlanta MCA Defense Lawyers Business Debt Relief

Why Legal Defense is Crucial for Fighting Back Against MCA Abuse

MCA companies rely on intimidation tactics because they know most businesses lack the resources to mount a legal challenge. By engaging an attorney, you demonstrate you have the means to fight back. This often motivates the MCA firm to offer a settlement rather than risk an outcome in court.With an MCA company making unilateral debits from your bank account, it can feel like you have no control. However, the legal system allows you to regain leverage in the situation. An attorney levels the playing field, forces the MCA to justify their actions, and makes them accountable for legal violations.Defending against predatory MCA lending is extremely challenging without guidance from specialists. Our lawyers have successfully represented numerous clients in similar situations and helped drastically reduce or entirely eliminate their MCA debts. We offer a free consultation so you can understand your rights and options at no cost.

The Benefits of a Free Consultation With Our MCA Defense Attorneys

We encourage any business owner struggling with overwhelming MCA debt to request a free case review. Here are some key benefits our consultations provide:1. Personalized Case Assessment

  • We thoroughly examine your MCA agreements, payment history, and unique circumstances. This allows us to provide tailored advice about the defenses and settlement strategies that may apply.

2. Expert Perspective on Your Options

  • By distilling insights from hundreds of prior cases, we can accurately gauge the prospects for defending against your MCA company and potential settlement outcomes. This empowers you to make informed decisions.

3. Clarity on Next Steps

  • We explain the litigation process in straightforward terms, dispel misconceptions about court disputes, and outline action plans for resolving MCA debt problems. This makes an intimidating process understandable.

4. Cost Estimates

  • If legal action is recommended, we provide fair, transparent estimates of attorney fees so you can evaluate the investment versus the potential rewards.

5. Hope and Reassurance

  • By showcasing past client successes and illustrating how the law protects against MCA abuse, we restore hope and confidence. You realize you have an ally that can change the trajectory of this financial nightmare.


How We Defend Against Unlawful MCA Collection Practices

When MCA companies empty business bank accounts without warning or mislead owners about what debts are owed, their practices directly contradict federal and state collection laws. Our attorneys specialize in holding MCA firms accountable for illegal collections.

Unlawful Debt Collection Methods Used by MCA Companies

MCA providers often violate fair debt collection rules in pursuit of payments. Their actions clearly contradict the federal Fair Debt Collection Practices Act and similar state statutes. Some common offenses include:

  • Emptying accounts through undisclosed debits – The FDCPA requires written notice before accessing consumer accounts. MCA companies often auto-debit without proper disclosures.
  • Harassing the business owner – Threatening lawsuits, asset seizures or criminal charges without an actual basis for such actions violates collection laws.
  • Misrepresenting the debt – Inflating the balance owed through fabricated fees or charges is illegal. So is attempting collections for the wrong amount.
  • Failing to verify the debt – Consumers have the right to written confirmation of what is owed. MCA firms frequently stonewall verification requests.
  • Deceptive communications – Implying legal action is imminent when no such plans exist contradicts federal and state statutes.
See also  10 Questions to Ask Business Debt Settlement Companies

Our Proven Process for Disputing Unlawful Collections

When an MCA company crosses legal lines to extract payments, we employ a systematic approach to freeze their efforts and compel compliance. Key steps include:1. Sending a cease and desist letter – This puts the firm on notice to stop collections until alleged violations can be remedied. It also starts a timeline for their legal duties.2. Disputing the debt – Exercising rights under the FDCPA to receive verification forces the MCA company to substantiate what is owed. Their failure to respond promptly can invalidate the debt.3. Negotiating a settlement – Demonstrating their statutory violations in writing enhances leverage to negotiate a reduced payoff amount. Many firms will settle to avoid defending their actions in court.4. Pursuing enforcement action – If the MCA provider ignores their responsibilities under federal and state law, we file suit to obtain court orders halting further collection activities.

Our Track Record With Disputing Unlawful MCA Collections

The attorneys at Delancey Street Law boast considerable expertise with confronting unlawful MCA collection tactics. We have routinely achieved victories such as:

  • Securing verification substantiating alleged debts – Without proper documentation, the MCA company has no legal basis for pursuing payment.
  • Obtaining written proof settlement agreements are satisfied – When balances are paid, firms often still report debts as outstanding. We compel them to set the record straight.
  • Forcing refunds of unauthorized debits – Hundreds or thousands of dollars withdrawn without proper notice get returned to client accounts.
  • Winning monetary judgments – Several of our cases have secured five-figure awards for violations of federal and state statutes.

By understanding collectors’ responsibilities under the law, we have helped numerous business owners fight back against MCA harassment and abuse. We welcome the opportunity to review your situation as well.<br>

Settling MCA Debts Through Lump-Sum Discounts

Lengthy court battles with MCA companies drain time, energy and money from operating your business. We focus aggressively on negotiating reduced-balance settlements so owners can eliminate debts and move forward.

Why Settlement Makes Sense for MCA Obligations

Litigating against MCA firms is certainly possible but also grueling. These companies have funding to keep cases tangled up legally for years. All the while, business owners face compounding interest charges and damaged credit.The uncertainty surrounding MCA agreements also muddies the waters. With their quasi-legal lending status, it can be difficult to predict how courts will rule. Even winning at trial does not guarantee debts go away forever.That is why a one-time, discounted lump sum settlement to satisfy MCA obligations often makes practical sense. Paying off debts at steep discounts allows businesses to avoid years of legal wrangling. Owners regain control over their financial future.

See also  Albuquerque MCA Defense Lawyers Business Debt Relief

Our Process for Negotiating Favorable MCA Settlements

The attorneys at Delancey Street Law leverage our litigation experience and industry knowledge to secure reduced-balance MCA settlements. We methodically build leverage, identify negotiating pressure points, and compel advantageous offers. Our process includes:1. Assessing Defenses – Thoroughly reviewing the MCA agreement and payment history reveals vulnerabilities and strengthens our hand at the bargaining table.2. Quantifying Damages – Documenting collection abuses and contract breaches boosts settlement leverage. Firms wish to avoid airing their misdeeds in court.3. Making Demands – We put forth well-researched settlement proposals, backed by evidence of legal exposures if our terms are refused.4. Negotiating & Finalizing – We stand firm on material settlement points while displaying flexibility on minor issues. The outcome is a discounted lump sum that closes out the MCA debt.

Real-World Examples of Our Settlement Successes

We have negotiated numerous lump-sum settlements that eliminated all future liability for our MCA clients. Here are some examples:

  • $17,000 owed reduced to $8,500 lump-sum payment
  • Six-figure MCA balance settled for $15,000
  • $73,000 debt with growing interest charges settled for one-time payment of $22,000


Defending Against Personal Guarantees on MCA Obligations

A common predicament faced by small business owners with MCA debts are personal guarantee claims. This allows the MCA firm to seize personal assets for a business debt. Our lawyers excel at defending against such liability.

Why MCA Companies Demand Personal Guarantees

Unlike a traditional term loan, MCA agreements do not require business assets to secure financing. The MCA provider’s only recourse in case of nonpayment is legal action against the company.To mitigate this risk, MCA firms routinely compel owners to sign personal guarantees. This commits their house, cars, investment accounts – everything they own personally – as collateral for the business’s debt.Many entrepreneurs do not fully grasp the gravity of personal guarantees until an MCA company comes trying to foreclose on their home. Our attorneys prioritize defending against such catastrophic loss.

Potential Defenses Against Personal Liability

MCA contracts with personal guarantee clauses are intentionally intimidating. However, avenues may exist to challenge or defeat personal liability:

  • Procedural errors – If guarantees are signed under duress or without proper explanations, the agreement may not be enforceable.
  • Substantive defects – Ambiguous guarantee language that contradicts other contract terms can undermine claims against the signee’s assets.
  • Breach by MCA provider – Violations of lending laws or failure to fulfill contractual duties may invalidate the personal guarantee.
  • Bankruptcy – Filing for business or personal bankruptcy halts collections and discharges debts. The guarantee becomes unenforceable.

Our lawyers thoroughly analyze guarantee agreements, searching for technicalities that could excuse clients from individual liability. We also negotiate with the MCA firm, citing their legal oversights and contract weaknesses to compel rescission of personal guarantees.




Delancey Street is here for you

Our team is available always to help you. Regardless of whether you need advice, or just want to run a scenario by us. We take pride in the fact our team loves working with our clients - and truly cares about their financial and mental wellbeing.

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