North Dakota MCA Defense Lawyers
Let’s talk about Merchant Cash Advance (MCA) Defense Lawyers. If you’ve taken out an MCA and now feel trapped by the terms, an MCA defense lawyer might be your lifeline. What’s an MCA? It’s not a loan. MCAs let funders buy a percentage of your future sales. You get a lump sum upfront, and they take a chunk of your earnings until it’s paid back. Sounds fair? Not always.
Why Hire an MCA Lawyer? MCA contracts are written to benefit the funders. They often contain terms that put businesses at serious financial risk. Lawyers help you review these contracts and fight back if needed. Can an MCA be stopped? Yes, lawyers can renegotiate your payment terms, reduce the daily drafts, or even challenge the whole contract. They use federal and state laws to protect your business. UCC Liens – A Common Threat MCA funders file UCC liens to freeze your business receivables. Under UCC Article 9, this lets them seize funds. A lawyer can help release those frozen funds.
Legal Tactics and Precedents
Did you know? New York banned Confessions of Judgment (COJs) for out-of-state businesses in 2019 (N.Y. C.P.L.R. § 3218). MCA funders now look for other states like Delaware and Utah where COJs are still legal. In states where COJs are still allowed (like Delaware, Ohio, and Utah), MCA defense lawyers can still challenge them, especially if there was fraud or coercion. Default Judgments: Funders can quickly freeze your bank account if a COJ is filed. But if you weren’t properly served, your lawyer might be able to vacate that judgment.
MCA Violates Usury Laws? In some states, like California (Civil Code Section 1916), MCAs could be treated as loans if interest rates exceed legal limits. This gives lawyers a strong argument to void the agreement. Litigation vs. Settlement: Sometimes, the best defense is negotiating. MCA defense lawyers often settle for less than the full amount owed. They might extend payment terms or lower interest. Breach of Contract? If the MCA funder violated your agreement, like misrepresenting the terms or stacking advances, your lawyer could file a counterclaim for breach of contract.
Debt Restructuring and Fraud
Restructuring Your Debt: Lawyers can restructure your MCA to better match your cash flow. Instead of daily drafts, they might negotiate weekly or monthly payments. Federal Law Protection: Under the Federal Trade Commission (FTC) Act, deceptive practices in MCA agreements could be grounds for legal action. MCA lawyers can challenge shady clauses. Fraudulent Brokers: Many MCA brokers lie during the funding process. Lawyers can hold them accountable, as fraud voids many contracts.
Bankruptcy Doesn’t Erase MCAs? Not always! Some MCAs require personal guarantees. Lawyers can argue these personal guarantees are illegal if the MCA agreement itself is void. MCA Settlements: Lawyers can sometimes negotiate a settlement where part of the MCA is forgiven—this is key when your cash flow has dried up. MCA defense lawyers are crucial when fighting UCC liens. If your receivables are frozen, an attorney can often unfreeze them by proving the lien was improperly filed or excessive.
Confessions of Judgment and Contract Violations
Confessions of Judgment (COJ): These are legal documents you might sign as part of an MCA, but if you were misled or not fully aware of their consequences, they can be challenged. Does Your Contract Violate State Law? Many MCA agreements break state-specific laws. For example, Texas Finance Code § 302 limits interest rates, and an MCA violating that can be voided.
Why Was My Account Frozen? MCA funders love to freeze your accounts if you default. Lawyers help fight this by arguing against the COJ or showing improper service of legal notices. Multiple MCAs? MCA stacking—taking out several advances at once—puts your business in jeopardy. Lawyers can argue that brokers lied or misrepresented how much debt you could handle.
Fraudulent MCAs and Default Judgments
Fraudulent MCAs: If an MCA funder falsified terms or failed to disclose crucial details, you might be able to void the entire agreement. Lawyers look for fraud in every contract. Judgment Vacated: Lawyers can vacate default judgments if you weren’t served properly. Imagine getting your account unfrozen just because the funder skipped a legal step!
Did They Violate Your Rights? Federal laws like the Fair Debt Collection Practices Act (FDCPA) protect business owners from abusive collection tactics. Lawyers hold funders accountable under these laws. MCA defense isn’t just about stopping payments—it’s about keeping your business alive. Every dollar saved, every contract voided, helps your business survive.
Final Advice and Prevention
Fight Back Against Debt: Merchant cash advances can bury your business, but with the right lawyer, you can fight back, save money, and keep your business afloat. Need help now? Call an MCA defense lawyer before it’s too late. Early intervention can make all the difference.
Pro Tip: Always have a lawyer review any MCA contract before you sign. Prevention is the best defense! In summary, MCA defense lawyers use laws like the UCC, state usury laws, FTC Act, and more to protect your business. Always fight for your business rights!
Want to know more? Find an MCA defense lawyer today to explore your options and protect your business from harsh repayment terms.