The Trap of MCA Lenders
MCA lenders ruin. They ruin livelihoods, and they ruin businesses. I’ve fought them. I’ve saved many businesses from their grip. I’ve helped many business owners survive. And today, I’m going to show you how we win against them.
MCA lenders say they’re here to help, but what they do is trap you. They trap you in contracts, they trap you in debt, and they trap you in fear. And when you try to settle? They might sue you. But I’m here to tell you how we win. How we keep fighting. They might sue. They might threaten. But what they can’t do is take away your rights. And when they sue, we fight. When they threaten, we fight. And when they push, we push back even harder. That’s how we win. I’ve done it, and I’ll do it again.
Every business owner must know this: MCA lenders want you scared. They want you quiet. But we fight them with the law, and the law is powerful. New York’s usury laws (N.Y. Gen. Oblig. Law § 5-501) and California’s protections (Cal. Fin. Code § 22002) make sure of that.
The Myth of Factoring Agreements
They think they’re clever. They think calling it a “factoring agreement” protects them. But Kapitus Servicing, Inc. v. Suburban Waste proved them wrong. Fixed payments? That’s a loan. Vague reconciliation? That’s a scam. And I’ll prove it again, and again, and again.
MCA lenders fear the truth. MCA lenders fear the law. And MCA lenders fear losing in court. Because when they lose in court, we win. We win partial victories, and we win full victories, and every victory keeps your business alive. In court, fixed payments make all the difference. If the payments don’t adjust with receivables, it’s a loan. It’s a loan under New York law, it’s a loan under California law, and it’s a loan under Pennsylvania law (41 P.S. § 201). And I’ve seen it happen again and again.
When they call it a factoring agreement, we say: prove it. And they can’t. Factoring depends on receivables. If the money’s not there, the payments should drop. But MCA lenders demand fixed payments, every single day. That’s not factoring. That’s a loan, and that’s how we win.
Bankruptcy as a Weapon
Bankruptcy changes everything. MCA lenders hate bankruptcy. Why? Because under federal law (11 U.S.C. § 362), all collections stop. The moment you file, their claws retract. They hate it, but it’s the law. And we use that to protect you.
I’ve used bankruptcy. I’ve used usury laws. I’ve used vague contracts. Every trick they have, I’ve seen. Every trap they set, I’ve dismantled. And I’ve done it case after case. I’ve saved businesses that thought they had no way out.
Why Partial Victories Matter
Partial victories matter. They matter because they mean survival. If we reduce the debt by 50%, your business survives. If we reduce it by 30%, your business survives. And survival is everything. Every inch counts, and every dollar saved matters.
In LG Funding v. United Senior Properties, the court knew the reconciliation clause was weak. It was vague, and it didn’t provide clear terms. And when reconciliation is weak, the contract is weak. And when the contract is weak, we win. And how do we win? We win because MCA lenders can’t handle real scrutiny. We win because their contracts fall apart under the law. We win because Davis v. Richmond Capital showed that fixed daily payments are loans, plain and simple. And we’ll keep winning.
Client Success Stories
When I talk to my clients, they think they’re doomed. They think they’re trapped. But what I tell them? I tell them there’s always a way out. There’s always a way to fight. There’s always a way to win—even if it’s just a partial win. And I’ve seen that happen time after time. I had a client, let’s call him John. John thought he’d lose everything. We fought. We filed for bankruptcy, and the lender sued. But we won. We settled for 35% of the debt. John’s business is still alive today. That’s how we fight. That’s how we win.
Leveraging UCC Filings to Your Advantage
MCA lenders love UCC filings. They think it gives them power. But in Michigan, if they don’t follow MCL 440.9302, their UCC lien is invalid. I’ve fought these liens before, and I’ve won. Every state has its laws, and every law is a tool in the right hands.
In Florida? MCA lenders can’t hide behind their interest rates. Fla. Stat. § 687.02 exposes them. If their rates are too high, we argue usury. I’ve made that argument, and I’ve won that argument. And when I win, my client survives. That’s what matters.
Recourse in bankruptcy is their last weapon. But even that’s weak. Under 11 U.S.C. § 524, personal guarantees can be challenged in bankruptcy. They’ll threaten you with bankruptcy, but they’re the ones who are scared. Bankruptcy is a tool, and we use it well.