Charlotte Merchant Cash Advance Attorney: Your Guide to MCA Debt Relief
Merchant cash advances (MCAs) have become a popular form of financing for small businesses in Charlotte, NC and across the country. Unlike traditional bank loans, MCAs provide quick access to capital with minimal paperwork. You simply fill out a short online application, and the funds can be deposited in your account within days.But MCAs come with a steep price. Because they are not considered “loans” under North Carolina law, MCA companies can charge exceedingly high fees and interest rates. And the repayment terms are often unreasonable, requiring you to pay back far more than the amount advanced.If your Charlotte business is struggling under the weight of MCA debt, you may be wondering if you need to hire a lawyer. Here’s what you need to know about working with a Charlotte merchant cash advance attorney and how they can help resolve your MCA debt issues.
How MCAs Work in Charlotte
Merchant cash advance companies provide upfront cash to businesses in exchange for a percentage of future credit card sales. Typically, the MCA company will withdraw a set amount from your bank account each day until the balance is repaid.For example, if you receive a $50,000 MCA, the company may take 15% of your daily credit card revenue. So if you have $5,000 in credit card sales, $750 would go to repaying the MCA provider.This may not sound too bad at first. But MCA contracts often have several hidden dangers:
-- Exorbitantly high effective interest rates of 200% or more
- Required daily or weekly payments that can be a huge burden on cash flow
- Personal guarantees holding business owners responsible for the debt
- Quick default clauses if you miss payments
Within months, many Charlotte business owners find themselves owing two to three times the amount they initially received yet still unable to pay off the balance.
When to Hire a Charlotte MCA Attorney
If you’re facing legal issues related to an MCA in Charlotte, hiring an attorney experienced with these types of agreements is usually wise. Here are some signs it may be time to seek legal help:
- You are struggling to make the daily payments and falling behind
- The MCA company is aggressively pursuing collections against you
- You received notice of a lawsuit related to the MCA debt
- There is a lien against your business assets or bank account
- Your credit score is plummeting due to MCA payment defaults
- Bankruptcy is looking like your only option for relief
An attorney can review your MCA contract for prohibited terms and violations of North Carolina laws. They may be able to get the agreement invalidated or help you file bankruptcy to eliminate the debt. Even if the contract is valid, a lawyer can negotiate a settlement or payment plan to resolve the debt.
Finding the Right Charlotte MCA Attorney
It’s important to choose an attorney who routinely handles MCA debt cases in Charlotte and statewide. Here are some key questions to ask during your search:
-- How many years have you been handling MCA cases in Charlotte and North Carolina?
- What strategies have you used to successfully resolve MCA debt for your clients?
- Are you familiar with North Carolina laws regarding MCAs?
- Will you review my agreement at no cost to look for violations?
- Can you provide references from past Charlotte MCA clients?
Avoid any law firm or debt relief company claiming they can make your MCA debt disappear. Reputable attorneys will be upfront about all options and potential outcomes.Also beware of MCA debt relief companies masquerading as attorneys. Ask specifically if the company‘s representatives are licensed attorneys in North Carolina who can provide legal counsel and representation.Many debt relief companies make misleading claims about being able to remove or renegotiate MCA debt. Often they simply take your money for “services” and do little to actually resolve your debt.
How a Charlotte MCA Attorney Can Help
Once you‘ve found an experienced Charlotte MCA lawyer you trust, here are some of the ways they can help:
- Review your MCA agreement for violations of North Carolina laws – This includes usury limits, lending license requirements, and prohibited terms. Violations can potentially invalidate the agreement.
- Challenge confessions of judgement – MCA contracts often contain these clauses allowing the company to seize your assets. An attorney can fight to overturn any judgments obtained this way.
- Defend against lawsuits – Your lawyer can represent you in court if the MCA company files a lawsuit over the debt. They can raise defenses to have the case dismissed.
- Negotiate a settlement – In many cases, an attorney can negotiate a lump-sum settlement or reduced monthly payments that are more affordable for your business.
- Help modify the MCA terms – This may involve lowering the daily repayment amount or extending the length of the agreement.
- Pursue legal action against the MCA company – If there is evidence of unlawful or fraudulent practices, your lawyer may be able to file a countersuit against the provider.
- Eliminate the debt through bankruptcy – Filing Chapter 7 or Chapter 11 bankruptcy may discharge part or all of the MCA debt. An attorney can advise if this is a viable option.
- Resolve UCC lien issues – MCA providers often place UCC liens on your business assets and bank accounts. A lawyer can help remove improper liens.
- Stop collections harassment – Your attorney can take over all communications and require collectors to interact only with them.