You’ve taken the first step towards protecting your business from predatory merchant cash advance (MCA) lenders. If you’re reading this, chances are you’re feeling overwhelmed, stressed, and maybe even a little scared about your MCA situation. We get it – MCAs can be a real nightmare for small business owners. But don‘t worry, we’re here to help.At DelanceyStreet.com, we’ve seen it all when it comes to merchant cash advances. From sky-high interest rates to aggressive collection tactics, we know exactly what you’re up against. And we’re ready to fight for you.In this article, we’ll break down everything you need to know about merchant cash advance defense in Raleigh, NC. We’ll cover the basics of MCAs, common legal issues, and how our experienced attorneys can help protect your business. So grab a cup of coffee (or something stronger – we won‘t judge), and let’s dive in.
What Are Merchant Cash Advances?
Let’s start with the basics. A merchant cash advance is a type of alternative financing where a company provides you with an upfront sum of money in exchange for a portion of your future sales. Sounds simple enough, right? WRONG.Here’s where things get tricky:
- MCAs aren’t technically loans, so they’re not subject to usury laws that cap interest rates
- Repayment is usually done through daily or weekly withdrawals from your bank account
- The “factor rate” used instead of interest can result in effective APRs of 50%, 100%, or even higher
In other words, MCAs can be a FAST TRACK TO FINANCIAL RUIN for many small businesses. We‘ve seen countless clients come to us drowning in MCA debt, wondering how they got into this mess.Take John, for example. He owns a small restaurant in downtown Raleigh and took out a $50,000 MCA to upgrade his kitchen equipment. The daily payments seemed manageable at first, but when sales slowed down during the pandemic, he quickly fell behind. Before he knew it, he was facing aggressive collection tactics and threats of legal action.Does this sound familiar? If so, you’re not alone. And more importantly, you have options.
Common Legal Issues with Merchant Cash Advances
Now that we’ve covered the basics, let‘s talk about some of the legal issues that often come up with MCAs. As experienced Raleigh MCA defense attorneys, we’ve seen it all – and we know how to fight back.
1. Usury Laws and Interest Rate Caps
One of the biggest issues with MCAs is that they often charge INSANELY HIGH interest rates. We‘re talking effective APRs of 100%, 200%, or even higher in some cases. But here’s the kicker – because MCAs are structured as “purchases” of future receivables rather than loans, they often claim to be exempt from usury laws.In North Carolina, the legal interest rate cap for most loans is 16% per year (N.C. Gen. Stat. § 24-1.1). But MCA companies argue that this doesn‘t apply to them. We disagree, and we’ve successfully challenged MCAs on usury grounds in court.
2. Confessions of Judgment
Many MCA agreements include a sneaky little clause called a “confession of judgment.” This allows the MCA company to go to court and get a judgment against you WITHOUT EVEN NOTIFYING YOU. It’s like being found guilty without a trial!While confessions of judgment are banned in some states, they’re still allowed in North Carolina in certain circumstances (N.C. Gen. Stat. § 1A-1, Rule 68.1). But that doesn’t mean they’re always enforceable. We’ve had success challenging these clauses and getting judgments vacated.
3. Unfair and Deceptive Trade Practices
MCA companies often use aggressive and misleading sales tactics to push their products. This can include:
- Misrepresenting the terms of the agreement
- Failing to disclose the true cost of the advance
- Using high-pressure sales tactics
These practices may violate North Carolina‘s Unfair and Deceptive Trade Practices Act (N.C. Gen. Stat. § 75-1.1). If we can prove that an MCA company engaged in unfair or deceptive practices, you may be entitled to treble damages and attorney‘s fees.
4. Personal Guarantees
Many MCA agreements include personal guarantees, meaning you’re on the hook for the debt even if your business goes under. But these guarantees aren‘t always enforceable, especially if they weren’t properly explained or if there was fraud involved in the transaction.We’ve helped clients challenge personal guarantees and protect their personal assets from MCA collectors. Don’t let them come after your house or your savings – fight back!
How Our Raleigh MCA Defense Attorneys Can Help
Feeling overwhelmed? Don’t worry – that‘s where we come in. Our experienced Raleigh MCA defense attorneys are here to fight for you and your business. Here‘s how we can help:
1. Comprehensive Case Review
When you come to us, we’ll start with a thorough review of your MCA agreement and all related documents. We‘ll look for any potential legal issues or defenses, including:
- Violations of usury laws
- Unfair or deceptive practices
- Improper personal guarantees
- Fraudulent inducement
We’ll leave no stone unturned in our quest to find ways to challenge your MCA debt.
2. Negotiation with MCA Companies
In many cases, we can negotiate with MCA companies to reach a more favorable settlement. This might include:
- Reducing the total amount owed
- Lowering daily or weekly payments
- Extending the repayment term
- Eliminating personal guarantees
Our attorneys are skilled negotiators with a track record of getting results for our clients. We know how to speak the language of MCA companies and get them to come to the table.
3. Litigation Defense
If negotiation isn‘t successful or if you’re already facing legal action, we’re prepared to defend you in court. Our litigation strategies may include:
- Challenging the enforceability of the MCA agreement
- Asserting counterclaims for unfair and deceptive practices
- Seeking to vacate confessions of judgment
- Defending against collection actions
We’re not afraid to take on even the biggest MCA companies in court. Our attorneys have extensive trial experience and a track record of success in complex commercial litigation.
4. Debt Restructuring and Bankruptcy Alternatives
In some cases, the best solution may be to restructure your debt or explore bankruptcy alternatives. We can help you understand your options and choose the best path forward for your business. This might include:
- Chapter 11 bankruptcy reorganization
- Assignment for the benefit of creditors (ABC)
- Negotiated workouts with multiple creditors
Our goal is to help you find a solution that allows your business to survive and thrive in the long term.
Why Choose DelanceyStreet.com for Your MCA Defense?
Look, we know you have options when it comes to choosing an MCA defense attorney in Raleigh. But here’s why we think we’re the best choice:
- EXPERIENCE: We’ve handled hundreds of MCA cases and have a deep understanding of the legal and financial issues involved.
- AGGRESSIVE ADVOCACY: We’re not afraid to stand up to MCA companies and fight for your rights.
- PERSONALIZED ATTENTION: We’re not some big, impersonal law firm. When you work with us, you’ll have direct access to experienced attorneys who care about your case.
- PROVEN RESULTS: We have a track record of success in negotiating settlements, defending litigation, and helping businesses get out from under crushing MCA debt.
- COMPREHENSIVE APPROACH: We don’t just focus on the legal issues – we look at the big picture of your business’s financial health and long-term goals.
Don’t just take our word for it. Here’s what some of our clients have to say:
“DelanceyStreet saved my business. I was drowning in MCA debt and didn’t know where to turn. They negotiated a settlement that reduced my debt by 60% and got rid of the daily payments that were killing my cash flow. I can’t thank them enough.” – Sarah T., Raleigh restaurant owner
“I was skeptical at first, but DelanceyStreet delivered on everything they promised. They fought hard for me in court and got a judgment against my business vacated. Now I can focus on growing my business instead of worrying about MCA collectors.” – Mike R., Raleigh retail store owner
Frequently Asked Questions About MCA Defense in Raleigh
We know you probably have a lot of questions about MCA defense. Here are some of the most common ones we hear:Q: Can I just stop paying my MCA?A: While it might be tempting to just stop paying, this can lead to serious consequences, including lawsuits, judgments, and damage to your credit. It’s better to work with an attorney to explore your legal options.Q: Will I have to go to court?A: Not necessarily. In many cases, we’re able to negotiate settlements or resolve issues without going to court. But if litigation is necessary, we’re fully prepared to represent you.Q: How long does the MCA defense process take?A: It varies depending on the complexity of your case and whether litigation is involved. Some cases can be resolved in a matter of weeks, while others may take several months. We’ll give you a realistic timeline based on your specific situation.Q: Can you guarantee I’ll be able to get out of my MCA debt?A: While we can’t make guarantees, we have a strong track record of helping clients reduce or eliminate their MCA debt. We’ll fight hard for the best possible outcome in your case.Q: How much does it cost to hire an MCA defense attorney?A: Our fees vary depending on the complexity of your case. We offer flexible fee arrangements and will work with you to find a structure that fits your budget. Remember, the cost of not getting help can be much higher in the long run.
Take Action Now to Protect Your Business
If you’re struggling with MCA debt in Raleigh, don’t wait to get help. The longer you wait, the worse your situation can become. Here’s what you should do RIGHT NOW:
- GATHER YOUR DOCUMENTS: Collect all of your MCA agreements, bank statements, and any correspondence with MCA companies.
- STOP COMMUNICATING WITH MCA COLLECTORS: Let them know you’ve retained an attorney and direct all future communication to us.
- CONTACT DELANCEYSTREET.COM: Call us at [phone number] or fill out our online contact form to schedule a free consultation.
- BE HONEST AND OPEN: The more information you can provide us about your situation, the better we can help you.
- STAY POSITIVE: Remember, there are solutions available. With the right legal help, you can overcome your MCA problems and get your business back on track.
Don’t let MCA debt destroy the business you’ve worked so hard to build. Contact DelanceyStreet.com today and let our experienced Raleigh MCA defense attorneys fight for you. We’re here to help you navigate this challenging situation and find a path forward.