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Arizona Merchant Cash Advance Lawyers Can Provide Debt Relief

Running a small business is tough. You have to worry about paying employees, keeping customers happy, managing inventory, and a million other things. With all those plates spinning, it can be tempting to take out a merchant cash advance loan to keep things running. But those loans come with sky high interest rates and aggressive collection tactics. If you find yourself falling behind, don’t panic. There are experienced Arizona merchant cash advance lawyers who can help you get the debt relief you need.

How Merchant Cash Advances Work

Let’s back up a second and make sure we all understand what a merchant cash advance (MCA) is. MCA loans are a form of business financing where the lender advances you money in exchange for a percentage of your future credit card sales.So say you get advanced $10,000. The lender may take 15% of your daily credit card sales until they’ve collected the full $10,000 plus their very high interest rate. The catch is there’s no fixed repayment schedule with MCAs. The lender takes their cut every day until the balance has been repaid.That flexible structure is what makes merchant cash advances appealing. You only make payments on days when you have credit card sales. But that flexibility comes at a steep price. Interest rates on MCAs typically range from 30% to 300% APR when you calculate out the equivalent.

Merchant Cash Advance Collection Tactics Are Aggressive

Because there’s so much money on the line, MCA lenders use very aggressive tactics to get repaid when businesses fall behind. They may:

  • Take more than the agreed upon percentage of daily credit card sales
  • Freeze or take money out of bank accounts
  • Threaten business owners and their families
  • File lawsuits without proper notice

These extreme collection tactics can spiral already struggling businesses into bankruptcy. But there are options besides just giving in to the harassment. An experienced Arizona merchant cash advance lawyer can help you:

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  • Negotiate with lenders for reduced payoffs
  • Fight back against illegal collection practices
  • Raise defenses to buy time or overturn lawsuits
  • Explore bankruptcy and debt relief options if negotiations fail

Arizona MCA Laws Provide Some Key Protections

Arizona has laws on the books designed to protect small businesses from predatory lending practices. An experienced lawyer can use these laws to challenge unfair or deceptive merchant cash advance agreements. For example:

Limits on Confessions of Judgement

Lenders will often have business owners sign a “confession of judgement” giving them the right to obtain a judgement without notice or a hearing. But Arizona law limits the enforceability of those provisions. Having a judgement hastily entered against you on an MCA loan can be financially devastating. An lawyer can fight to overturn improper judgements.

Unconscionable Loan Terms May Be Unenforceable

Under Arizona statute § 47-5108, unfair loan contract terms that “shock the conscience” can be deemed unenforceable. The extreme interest rates and aggressive collection provisions common with MCA loans may meet that standard. A skilled negotiator can leverage those protections to convince lenders to settle for less than the full inflated balances.

Illegal Lender Threats Can Void Loans

When collection efforts cross the line into illegal threats and harassment, that can be grounds under Arizona law for the debt to be deemed void. Experienced lawyers know how to gather evidence of illegal collection practices and use it negotiate settlements or overturn judgements.

How an Arizona Merchant Cash Advance Lawyer Can Help

As you can see, Arizona business owners facing aggressive MCA collections do have rights. The key is connecting with a lawyer experienced at leveraging those rights to get you the relief you need. Specifically an Arizona merchant cash advance lawyer can:

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Negotiate Reduced Payoffs

The first step is attempting good faith negotiations with the MCA lender. An experienced lawyer knows what terms are realistic to ask for and can put together a thorough financial package documenting why a settlement is in the lender’s best interest. If both sides are willing to compromise, a settlement for less than the full inflated loan balance may be possible.

Defend Against Lawsuits

If lenders won’t come to the table or negotiations break down, the next step is defending against any lawsuits filed to collect. There are a number of potential defenses available against improper merchant cash advance agreements. A lawyer can raise arguments about excessive interest rates or illegal contract terms and may be able to get cases dismissed or judgements overturned.

Explore Bankruptcy Options

If lawsuits fail and the business still can’t get back on sound financial footing, bankruptcy may be on the table. Chapter 7 or Chapter 11 bankruptcy can eliminate or restructure debts that are dragging down the business. An attorney experienced with both debt relief laws and merchant cash advance agreements can advise if bankruptcy is the right path forward.The important thing is not waiting until things have reached a crisis point. At the first sign your business is struggling with merchant cash advance debts, consult an attorney. An ounce of prevention is worth a pound of cure when it comes to business debt relief. Don’t let predatory lenders threaten all you’ve worked for.

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Connect with Arizona Merchant Cash Advance Lawyers

If you need legal help negotiating, settling, or defending against merchant cash advance debts, Delancey Street has experienced attorneys on staff. 

IF YOU’RE LOOKING FOR A BUSINESS DEBT SETTLEMENT COMPANY, VISIT DELANCEY STREET. CLICK HERE NOW.

 

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$500,000 MCA Restructured Over 3 Years
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