Now Reading: Garland MCA Defense Lawyers Business Debt Relief


Garland MCA Defense Lawyers Business Debt Relief

February 24, 20248 min read



Garland MCA Defense Lawyers Business Debt Relief

If you run a small business in Garland and have merchant cash advance (MCA) debt, you may be struggling under the weight of high payments and fees. Delancey Street has a team of attorneys who can provide MCA debt relief through negotiating settlements or defending you in litigation.

How We Can Help With MCA Debt

Our attorneys have extensive experience dealing with MCA companies and understand the predatory nature of many of these financing arrangements. We can help in a few key ways:

  • Negotiating settlements – We’ll analyze your agreement, assess your leverage, and negotiate the lowest possible buyout amount. Many MCA deals can be settled for 30-60% less than the outstanding balance.
  • Defending lawsuits – If an MCA company sues you, our lawyers can evaluate defenses and represent you in litigation. Common defenses include lack of personal jurisdiction, usury violations, and fraud.
  • Restructuring payments – If settling or defending isn’t feasible, we may be able to negotiate reduced payments and fees going forward. This provides cash flow relief.
  • Unwinding confessions of judgment – If you signed a confession of judgment as part of the MCA deal, we may be able to get it rescinded by showing it was signed under duress or without proper legal advice.
See also  Arkansas MCA Defense Lawyers Business Debt Relief

The key is acting quickly when you get behind on payments to preserve options. The longer you wait, the more leverage tilts to the MCA company.

Why MCA Companies Can Be Predatory

Merchant cash advance loans are often extortionately expensive, with interest rates exceeding 100% APR when factoring in fees. Many small business owners don’t realize what they’re getting into until the massive payments become unsustainable.There are several common predatory practices in the MCA industry:

  • Deceptive marketing – MCAs are marketed as flexible financing based on future sales, but the reality is fixed daily payments at extremely high effective interest rates.
  • Overreliance on limited data – Approval decisions are made based just on a few months of bank statements. The full financial picture is ignored.
  • Ignoring total debt obligations – MCA companies don’t consider other debts you may have, leading borrowers to become overextended.
  • Rushing due diligence – The application process is rushed, with term sheets spanning just a few pages instead of a thorough underwriting process.
  • Confessions of judgment – MCA contracts often contain confessions of judgment waiving legal defenses if payments can’t be made.

While not all MCA companies are predatory, many are. It’s important to protect yourself by working with a lawyer on the front end before signing anything.

MCA Company Litigation Tactics

If your MCA payments become unsustainable, the company may deploy aggressive tactics to collect, including:

  • Harassing calls – MCA companies will call you constantly both at home and your place of business if payments fall behind.
  • Freezing business accounts – They may send notices to your bank or merchant processor requesting accounts be frozen.
  • Personal guarantees – Even if the MCA contract is with your business entity, owners often provide personal guarantees. They can pursue your personal assets.
  • Lawsuits and confessions of judgment – MCA companies quickly file lawsuits if payments are missed. The confession of judgment you signed means they can get a judgment without even notifying you of the lawsuit.
  • Debt collection harassment – Unpaid debts get sold to aggressive debt collectors who will also pursue you personally.
See also  Alaska MCA Defense Lawyers Business Debt Relief

Facing these tactics without experienced legal counsel is daunting. Our lawyers defend business owners from MCA harassment every day.

Specific Legal Defenses Against MCA Companies

When MCA companies sue small businesses for unpaid balances, there are defenses business owners can assert. Our lawyers thoroughly evaluate the merits of potential defenses, including:

  • No personal jurisdiction – If the MCA company is located in another state, they may not be able to sue you in Texas unless they have sufficient business contacts here.
  • Usury violations – Texas usury laws limit interest rates to no more than 10% APR unless Merchant Cash Advance agreements comply with technical legal requirements. If not, the contract can be void.
  • Unconscionability – If the fees and terms are so one-sided as to “shock the conscience”, courts can refuse to enforce the agreement. Elements of procedural and substantive unconscionability must be shown.
  • Fraud and misrepresentation – Evidence that the MCA company made false statements about costs or other terms could form the basis for a fraud claim.
  • Duress – If evidence shows the business owner was under extreme pressure when signing, the contract may not be enforceable.
  • Breach of contract – If the MCA company did not provide the agreed upon amounts after executing the agreement, they may have breached first.
  • Violation of Texas Deceptive Trade Practices Act – Making false, deceptive or misleading statements about services violates this consumer protection law and may entitle the borrower to damages.

The viability of defenses depends on the specific facts and language in the MCA contract. Our experienced lawyers thoroughly analyze the agreement to identify arguments to deploy in litigation or negotiations.

See also  Anchorage MCA Defense Lawyers Business Debt Relief

What To Expect Working With Our MCA Defense Lawyers

If you engage our law firm for MCA debt relief, here is an overview of what to expect:

1. Strategy Consultation

First, we’ll schedule an in-depth strategy session to review your situation, agreements, debts owed, litigation status, and financing needs. Based on our experience defending similar cases, we’ll assess options and recommend next steps.

2. Negotiations or Litigation

If settling debts through negotiation appears viable, we’ll engage the MCA companies to propose discounted buyouts. If litigation is pending or inevitable, our lawyers will file notices of representation and evaluate defenses to assert. We may also seek to negotiate reduced payment plans.

3. Ongoing Support

Even after settlements are reached, MCA companies sometimes continue harassing tactics trying to extract more payments. We’ll provide ongoing legal support responding to any continuing communications or collection efforts.The key takeaway is that experienced legal representation levels the playing field when dealing with predatory MCA companies. Call Delancey Street today at 212-210-1851 to schedule a free case assessment. Our lawyers understand the MCA industry’s tactics and how to best defend your interests. Don’t face the threats alone.






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