MCA Merchant Cash Advances Law Firm

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MCA Merchant Cash Advances Law Firm
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An Intelligent, Assertive MCA Lawyer Serving Businesses Throughout The Nation

Merchant Cash Advance Attorney Serving Tennessee

Last updated on December 17, 2024

Are you a business owner in Tennessee feeling overwhelmed by debt from merchant cash advances (MCAs)? Many small business owners resort to MCAs in times of need or desperation, only to find that they are worse off than when they started. Draconian repayment terms, exorbitant interest and aggressive collections practices can turn what seems initially like a lifeline into a weight that could sink your business.

Merchant Cash Advance Law Firm P.C. helps Tennessee small business owners get out from under the oppressive weight of MCA debt. Founded and led by attorney Dominick Dale, the firm represents only business owners in MCA debt cases. That focus has given him an in-depth understanding of the ins and outs of MCAs. With nearly two decades of experience, Dale is a formidable advocate for small to mid-sized businesses across various sectors. The firm’s commitment to prompt and decisive action makes it a reliable partner in your fight against unfair financial burdens.

Tennessee Businesses The Firm Serves

Merchant Cash Advance Law Firm P.C. represents small- to mid-sized businesses in Nashville, Memphis, Knoxville, Chattanooga and statewide, including:

  • Retail businesses
  • Transportation companies
  • Construction companies
  • IT businesses
  • Restaurants and bars
  • Medical practices
  • Insurance brokers
  • Professional practices
  • Automotive repair shops
  • Beauty salons

As a business owner himself, attorney Dale understands the challenges and pressures that come with managing a company’s finances. His personal experience equips him with unique insights into the struggles that businesses face. This firsthand knowledge drives his passionate advocacy and commitment to helping other business owners navigate and overcome the nightmare of MCA debt.

Understanding Merchant Cash Advances (MCAs)

MCAs are not as straightforward as business loans. Here are some things to know about them.

What Are MCAs?

MCAs are a nontraditional financing option. Through an MCA, you agree to give up a portion of future business proceeds in order to obtain cash for your business now. MCAs are more accessible to businesses that might not qualify for traditional loans. They don’t require a solid credit history or collateral. They do, however, come with aggressive repayment terms that aren’t very transparent. Many business owners obtain MCAs without fully understanding the terms and conditions.

Common Terms And Conditions Of Tennessee MCAs

MCAs are structured differently from traditional business loans. They come with complex and confusing terms that can significantly impact your business’s cash flow and operational capabilities. Here’s a deeper look into the common terms associated with MCAs:

  • Advance amount: This is the lump sum amount of cash that you receive from the MCA provider. It is typically based on your business’s projected future sales and is calculated after evaluating your recent sales records.
  • Payback amount: Also known as the retrieval rate, this is the total amount that the business owner agrees to pay back to the MCA provider. It includes the advance amount plus fees and interest, which are typically higher than those of traditional loans.
  • Holdback: This term refers to the percentage of daily or weekly sales allocated to repay the MCA. The holdback rate varies depending on the provider and the perceived risk level of your business, but it generally ranges from 10% to 20% of your sales.
  • Term of the advance: Unlike traditional loans with fixed end dates, the term of an MCA depends on your business’s sales volume since repayment is based on a percentage of sales. This means that the actual duration of the advance could be shorter or longer than anticipated, depending on your business performance.
  • Factor rate: This is a decimal figure that determines the total amount you owe based on the advance amount. It is usually between 1.1 and 1.5 times the amount advanced. For example, if you receive a $10,000 advance with a factor rate of 1.2, you would need to repay $12,000. Unlike interest rates that accrue over time, the factor rate is calculated once at the beginning and does not change.

Risks Of MCAs For Tennessee Business Owners

While MCAs offer quick access to capital, their aggressive repayment terms can quickly jeopardize your business’s financial stability. MCAs can very easily lead to a cycle of debt. Businesses often find themselves taking out additional advances to cover the high repayments of an existing MCA, which ultimately adds to their financial strain rather than alleviating it. This cycle can hinder long-term business growth and sustainability, trapping businesses in a continuous loop of borrowing and repayment.

What’s more, MCA providers often secure UCC liens against businesses as part of the Tennessee merchant cash advance agreement. These liens grant the MCA providers a legal claim over your business assets until the debt is fully repaid. UCC liens can severely limit your flexibility in managing your business finances, as any attempts to secure additional financing or sell business assets might require prior clearance from the lien holder. The presence of a UCC lien also can negatively impact your business’s credit rating, making it even more challenging to obtain other forms of financial relief.

MCAs Vs. Business Loans

MCAs are different from business loans. They are technically considered commercial transactions, not loans, which means that laws governing business loans typically don’t apply to them. This lack of regulation leaves business owners unprotected from predatory MCA terms.

When To Seek Legal Help For MCA Business Debt

It’s crucial to recognize when merchant cash advances are threatening the health of your business. Common signs that it’s time to seek help include:

  • Inability to meet daily operational costs
  • Use of one MCA to pay off another, indicating a cycle of debt
  • Collections calls or default notices from lenders
  • Legal actions against your business such as court summons or judgments
  • Struggles with cash flow issues due to high repayment demands
  • UCC lien foreclosure actions against your business

It’s best to get legal guidance sooner rather than later. If you wait too long, the situation could escalate, making it even harder to get out of MCA debt.

Legal Help Is Available

If your business is shouldering the unsustainable weight of MCA debt, attorney Dominick Dale at Merchant Cash Advance Law Firm P.C. can assist in various ways, including:

  • Negotiation: He can work to restructure your Tennessee MCA agreement with lower payments that are sustainable for your business.
  • Litigation: Attorney Dale will aggressively pursue legal action to protect your interests and hold the MCA provider accountable for any legal violations.
  • Collections defense: He can defend you against aggressive and unlawful debt collection practices. He can challenge any actions that violate the Fair Debt Collection Practices Act (FDCPA) or other relevant statutes, providing a shield against harassment and abuse in debt collection.
  • UCC lien removal: He can seek to remove liens that restrict your control over business assets.
  • Default judgment removal: If a default judgment has already been entered against your business, attorney Dale can work to overturn it and provide a fresh start.

Attorney Dale will work swiftly and tirelessly to untangle your business from the grip of MCA debt.

Call For A Free Consultation

Don’t let merchant cash advances threaten your business any longer. Contact Merchant Cash Advance Law Firm P.C. today for a free 30-minute consultation, available 24 hours a day. You can also call 347-588-5590 to discuss your Nashville MCA loan.