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Indiana Merchant Cash Advance Attorney

Merchant cash advances can seem like a quick fix for small businesses in Indiana needing capital. But these loans often trap owners in a cycle of debt. This article explains how merchant cash advances work, their risks, and how an attorney can help.

What is a Merchant Cash Advance?

A merchant cash advance (MCA) provides a business with a lump sum of cash in exchange for a percentage of future credit card sales. It’s not technically a loan, so MCA companies can skirt state laws capping interest rates.MCAs appeal to businesses who can’t qualify for bank loans or need money quickly. Approval is based on credit card receipts, not credit scores. Funds can arrive in days.Unlike a term loan, MCAs have no fixed end date. You pay a percentage of daily or weekly credit card sales until the full amount is repaid, often within 6-18 months.

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The MCA Trap

While fast cash is tempting, MCAs create a debt trap for many Indiana businesses:

  • High cost – MCAs charge the equivalent of 60-400% APR in fees. This is 3-10 times higher than a business loan.
  • Daily/weekly payments – MCA payments are taken directly from credit card sales, reducing cash flow. If sales dip, payments remain the same, extending the payback period.
  • No early payoff – With a term loan, extra payments reduce the balance. MCAs still take the fixed percentage regardless of the remaining balance.
  • Personal guarantee – MCA contracts often require a personal guarantee from the business owner. This puts your personal assets at risk if the business defaults.
  • Aggressive collections – MCA companies quickly file lawsuits and wage garnishments against defaulted borrowers. This can tank your credit and business.

When to Contact an Attorney

Involve an attorney as soon as possible if:

  • You default on MCA payments
  • The MCA company threatens to sue you
  • You need to reduce unaffordable payments
  • You receive a court summons for breach of contract

Our attorneys can often negotiate settlements or payment plans with MCA companies, avoiding costly lawsuits. Acting preemptively puts you in a stronger position.If sued, an attorney can raise defenses to fight the lawsuit:

  • Unconscionability – Argue the MCA terms are unfairly one-sided
  • Usury – Claim interest rates exceed state laws
  • Deceptive practices – Allege the MCA company misled you on terms

Settlement Strategies

Rather than risk court, many MCA companies will negotiate settlements to recoup at least part of the balance. Potential strategies include:

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  • Payment reduction – Lower monthly payments to affordable levels
  • Term extension – Stretch payments over more months to improve cash flow
  • Partial settlement – Agree to pay a lump sum that’s less than the full balance
  • Payment plan – Settle to pay a portion over time rather than upfront

Our attorneys leverage their litigation experience to negotiate effectively with MCA companies. Settlements often reduce debts by 25-50% with favorable repayment terms.

Finding the Right Attorney

If struggling with MCA debt, partner with an attorney who:

  • Has extensive experience negotiating MCA settlements
  • Understands MCA company tactics and pressure points
  • Will customize a strategy based on your situation
  • Charges fair, transparent attorney fees
  • Is licensed in your state (Indiana)
  • Responds quickly and keeps you informed


Merchant cash advances seem like an easy fix but often create a downward debt spiral for Indiana small businesses. Work with an attorney at the first sign of trouble to defend against lawsuits and negotiate a favorable settlement. This can help stabilize your finances and avoid business catastrophe. Don’t go it alone against predatory MCA lenders.

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Our team is available always to help you. Regardless of whether you need advice, or just want to run a scenario by us. We take pride in the fact our team loves working with our clients - and truly cares about their financial and mental wellbeing.

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$500,000 MCA Restructured Over 3 Years
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$350,000 MCA Restructured Over 2 Years

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