Merchant Cash Advance Defense in New York
Merchant Cash Advance Defense in New York
Merchant cash advance (MCA) defense in New York involves challenging unfair MCA agreements, abusive collection tactics, or improper legal filings such as confessions of judgment. A skilled MCA attorney can help protect your business, negotiate repayment, and fight in court if necessary.
Merchant cash advances (MCAs) are marketed as fast, flexible funding for small businesses, but many New York business owners quickly find themselves in deep financial trouble after signing an MCA agreement.
At J. Singer Law Group, we represent businesses throughout New York that are facing aggressive funders, frozen bank accounts, and legal threats due to predatory MCA contracts. If you're overwhelmed by daily debits or have been hit with a surprise judgment, you’re not alone, and you may have legal options.
What Is a Merchant Cash Advance?
A merchant cash advance is not technically a loan. Instead, it’s structured as a sale of your future receivables. You get a lump sum up front, and the MCA company collects a percentage of your daily or weekly sales until the full amount, plus significant fees is paid back.
MCAs often carry effective interest rates over 100%, and they’re not subject to the same regulations that govern traditional loans. That lack of oversight allows funders to use tactics that would be illegal in other lending contexts.
Common Legal Issues With MCAs
Here are some of the most frequent legal problems we see in MCA cases:
1. Confessions of Judgment (COJs)
Many MCA agreements include a COJ clause that lets the funder file a judgment against you without a trial if they claim you breached the agreement. Even though New York limited COJs against out-of-state businesses in 2019, many funders still file them in other jurisdictions, or use improper tactics to rush enforcement.
2. Bank Account Freezes
Some MCA companies work with third-party debt collectors or attorneys to freeze your business account through a legal mechanism called restraining notices, often without warning.
3. Stacked MCAs
Taking multiple MCAs to pay off previous ones can create a debt spiral that’s nearly impossible to escape. Funders know this and may push additional funding as a solution, worsening your situation.
4. Predatory Terms and Misrepresentation
If the agreement was misrepresented, not clearly explained, or contains unconscionable terms, you may have grounds for a legal challenge.
Do You Have a Legal Defense?
Yes, in many cases, merchant cash advance contracts can be challenged. Courts are increasingly recognizing that some MCAs are actually disguised loans subject to state usury laws.
Potential MCA Defenses in New York
- The agreement functions as a loan, not a purchase of receivables
- The terms are usurious (interest rates above the legal limit)
- The funder used fraud or deception
- The confession of judgment was filed improperly or without your knowledge
- You never received the funds as agreed
- The funder interfered with your business operations
What an MCA Defense Lawyer Can Do
A skilled attorney can help by:
- Reviewing your agreement for legal flaws or exploitative terms
- Filing motions to vacate a judgment or unfreeze your bank accounts
- Negotiating a settlement or new repayment plan
- Representing you in court to challenge improper filings
- Advising on bankruptcy options, if necessary, to protect your business
How J. Singer Law Group Helps New York Businesses
At J. Singer Law Group, we’ve helped numerous small business owners across New York stand up to MCA funders and protect their livelihoods.
Our approach includes:
- Full contract review and legal analysis
- Emergency action to vacate judgments or unfreeze assets
- Strategic negotiations to reduce debt burdens
- Defense against lawsuits or improper collections
- Long-term planning for financial stability and recovery
We understand the stress MCA debt causes, and we fight hard to give our clients the breathing room they deserve.
Who We Help
We represent:
- Restaurants and bars
- Construction companies
- E-commerce stores
- Transportation and logistics businesses
- Service professionals and retail shops
- Any small business caught in the MCA debt trap
Whether you took one advance or several, we’re here to help you push back and regain control.
Frequently Asked Questions (FAQ)
1. Can I get out of an MCA contract?
In some cases, yes. If the agreement is found to be a disguised loan or includes illegal terms, it may be challenged in court.
2. What if a judgment has already been entered?
You may still be able to vacate the judgment, especially if it was based on a confession of judgment or filed improperly.
3. Will my business bank account stay frozen?
We can file a motion to unfreeze your account and stop collection efforts while your case is being reviewed.
4. Do I need to go to court?
Sometimes, but not always. Many cases are resolved through negotiations or settlement agreements without litigation.
5. How much does MCA defense cost?
We offer flexible fee structures based on your case and needs. The first consultation is always free.
Fight Back With New York’s Trusted MCA Defense Team
Don’t let a merchant cash advance destroy your business. If you’re facing lawsuits, frozen accounts, or daily payments you can’t afford, help is available.
Contact J. Singer Law Group today for a confidential consultation. We’ll review your contract, explain your options, and act quickly to protect your business.
Call now to speak with a
New York MCA defense attorney who knows how to fight and win.
