Business owners who face financial challenges may turn to merchant cash advances (MCAs) to stay afloat. However, MCAs can come with significant risks, including the potential for a lender to enforce a UCC lien against the business. Are you a business owner dealing with a UCC lien enforcement action and wondering how to protect your assets?
Severe implications for your business
When a lender enforces a UCC lien, it can give them significant control over the assets of your business. Some of the ways a UCC lien enforcement action can profoundly affect your business include:
- Freezing of bank accounts, making it difficult for your business to access its funds and operate daily
- Seizure of assets such as equipment or inventory, which can disrupt business operations and decrease revenue
- Disruption of cash flow, making it challenging for your business to meet its financial obligations
- Loss of control over business operations, as the lender may be able to make decisions about the assets and finances of your business
- Closure, as your business may no longer be able to operate due to the lack of access to funds or assets
The consequences of a UCC lien enforcement action can be devastating and long-lasting, such as a permanent shutdown that causes the loss of livelihood for you and your employees. Thus, it is essential to take immediate steps to protect your business assets when facing a UCC lien enforcement action.
Aiming to save your business
A UCC lien enforcement action can be a powerful tool for a lender, but it can also be a nightmare for you as a business owner who is struggling with MCA payment defaults. By seeking advice from an attorney, you may better navigate the complexities of a UCC lien enforcement. In addition, having legal counsel may help you negotiate with the lender and find other solutions as you aim to save your business.