Value capital funding


Home > Blog > Legal Consequences of MCA Defaults and Collections
The Risks of Defaulting on Multiple Outstanding MCAs

BY Value Capital Funding

August 25, 2023

Legal Consequences of MCA Defaults and Collections

Legal Consequences of MCA Defaults and Collections

Navigating the murky waters of Merchant Cash Advances (MCAs) can lead small businesses into a web of legal issues surrounding MCA defaults and collections. Below, we will expose the aggressive tactics employed by MCA companies, revealing how they target accounts receivable and credit card processing payments to reclaim outstanding debts.

Contrary to the belief that MCAs are unsecured, their relentless pursuit of repayment demonstrates otherwisemaking them far from risk-free for businesses. As misinformation spread through the marketplace, we shed light on the true risks associated with MCAs, urging business owners to be cautious.

At Value Capital Funding, transparency is important, thus adhering to all disclosure requirements and providing a secure alternative like MCA debt restructuring. Protect your business from legal pitfalls and choose the path of clarity and trust with Value Capital Funding’s reliable financing solutions.

The Legal Ramifications of Defaulting on MCA Payments

When businesses find themselves unable to keep up with the demanding terms of Merchant Cash Advances, the consequences can be severe. Defaulting on MCA payments triggers a series of legal issues surrounding MCA defaults and collections.

There is a common misconception that Merchant Cash Advances are completely unsecured. However, MCA companies often use aggressive measures to recover their funds. If a business fails to repay, the MCA company may attack their accounts receivable and credit card processing payments, creating a challenging situation for the already struggling business.

In addition, MCA lenders typically do not report timely payments to credit bureaus, which means your business credit score remains unaffected by regular MCA repayments. However, this lack of reporting also means that resolving MCA debt won’t help improve your credit score either.

The misinformation about MCAs being risk-free permeates the marketplace, yet the reality paints a different picture.

Caught in the Crosshairs: Understand the Harsh Realities of MCA Collections

Once a business defaults on an MCA, it becomes a target in the unforgiving world of MCA collections. MCA companies swiftly initiate aggressive collection tacticsleaving the business caught in the crosshairs of their relentless pursuit.

From hounding calls and letters to potential legal actions, MCA collections can be an overwhelming experience. These aggressive collection efforts can impact a business’s daily operations and financial stability, making it challenging to escape the cycle of debt.

The risks associated with MCA collections underscore the importance of exploring alternative financing options to protect the business from such detrimental consequences.

Legal Consequences of MCA Defaults

The legal issues surrounding MCA defaults and collections can leave small businesses vulnerable and distressed. MCA companies will not hesitate to pursue legal action to reclaim their outstanding funds, placing the business in a precarious position.

To add to the complexity, the misconception that MCAs are unsecured can create a false sense of security for borrowers, leading them to underestimate the potential legal ramifications. Small businesses must be aware of the true implications of defaulting on an MCA and the serious legal consequences it entails.

Choose A Safer Path:  Embrace MCA Debt Restructuring

When businesses face the daunting prospect of defaulting on Merchant Cash Advances, the legal consequences can be overwhelming. The good thing is that there is a safer and more viable solution available: MCA debt restructuring.

By choosing MCA debt restructuring, businesses can proactively address their MCA debt challenges without falling into the pitfalls of an unprotected default. An attorney-led team works on your behalf to renegotiate the terms with MCA lenders, creating a more manageable repayment plan. This allows you to lower payments, extend the repayment period, and even reduce the outstanding principal, relieving the financial strain.

By embracing MCA debt restructuring, businesses can find a sustainable path forward, avoiding the legal repercussions of an unprotected MCA default. With a custom-tailored solution that aligns with your financial capabilities, you can regain control of your finances and secure a brighter financial future.

Find Relief from MCA Collections: Choose MCA Debt Restructuring as Your Solution from Value Capital Funding

Find relief from MCA collections and the legal issues surrounding MCA defaults and collections with MCA debt restructuring from Value Capital Funding. Our free consultation allows us to evaluate your situation, gaining insight into your business’s unique needs.

No one-size-fits-all strategy here—our team will thoroughly analyze your business structure and discuss affordable payment levels with you. Expect an immediate drop of 40% to 75% in your payments with a customized, sustainable plan.

Choose a safer and more viable solution to address your MCA debt challenges. Say goodbye to the overwhelming burden of aggressive MCA collections. With MCA debt restructuring, our attorney-led teams will negotiate with MCA lenders to create a more manageable repayment plan, lower monthly payments, and improve your cash flow.

Protect your business’s future and avoid the harsh consequences of MCA collections. Contact us now at 800-944-6280 to explore MCA debt restructuring and secure a brighter financial path. Trust in Value Capital Funding’s expertise to navigate the complexities and regain control of your finances.

as seen on