Skip to content. Before you have any bank accounts frozen or garnished, UCC liens filed against merchant processors/vendors, or you have a lengthy lawsuit filed against you that you would have to spend countless hours and money on, call us today for a complimentary consultation with an experienced business debt attorney. . If it takes a week to set up the account, it may also take a week to have funds remitted to you. A holdback percentage determines the amount of money an MCA company will subtract from your daily credit card sales. Some small business financing providers in California provide financing in the form of "merchant cash advances" or "sales of future receivables" through which businesses receive cash up-front in exchange for "selling" a portion of their future revenue. Because merchant cash advances are not deemed loans, they are not subject to any regulations. The bill adds a new Division (Division 9.5) to the California Financing Law (CFL). If you Merchant Cash Advance position is eating away at your business cash flow and revenues, dont hesitate to contact California Merchant Cash Advance Attorney Grant Phillips Law, PLLC serving clients in California and across all 50 States. The California Financing Law (CFL) has historically been guiding licensing procedures for finance brokers and lenders. Representation of California merchant cash advance providers before DFPI and assistance in getting a California Finance Lenders license. You may need new equipment, additional inventory or maybe you just need to cover payroll. The life of this loan is also much shorter than a normal remittance which can end up causing problems if the borrower is not prepared to pay back the money during that agreed-upon time. Merchant Cash Advance in California is a type of finance that assists businesses financially. What is a Merchant Cash Advance? Both finance lenders and brokers require licenses to operate in California. Merchant Cash Advance Attorney California. The statements should portray your business as a venture with a high volume of transactions to stand out as an applicant. All rights reserved. The Business Debt Law Group can help make arrangements with creditors and lenders for our clients to ensure that you make the necessary payments while also keeping your doors open. Thus, it has been a popular choice for business owners seeking to assist or expand their businesses. Sorry, the comment form is closed at this time. Merchant Cash Advance Regulation. The money is usually a percentage of your debit card or credit card sales withheld by an MCA provider to settle a cash advance. Too often this thinking ends up making things worse for your business, with frozen business accounts, debt, liens, lawsuits and judgments. Moreover, you have the choice of using the option as your requirements. If you have a stable cash flow, it may take you a shorter time to pay back the cash advance. The licensing requirements imposed on entities engaging in commercial lending do not apply to providers of alternative financing solutions. THE LAW OFFICES OF ALAN ABERGEL, P.C. If you are having trouble with repayment or an defaulted MCA, rely on our attorneys as the best option to get your money back. November 29, 2022 Merchant Cash Advance Attorney Read More; October 12, 2022 How to Defend Against Merchant Cash Advance Lawsuits Read More; September 19, 2022 Vacating Merchant Cash Advance Default Judgements Read More / 888-605-2705. Our experts will review your information and contact you for further discussions. Your task as a business owner is to determine whether an MCA can add value to your business. Call 800-961-8924 Apply Now Hiring merchant cash advance attorneys before your debt problems grow worse will ultimately save you from a potential future bankruptcy. The California Senate and Assembly passed SB 1235 on August 31, 2018, and Governor Brown signed it into law on September 30, 2018. *Images used are not employees of the law firm*, difference is between alternative financing and traditional loans, advancing through the House of Representatives, beginning to be examined much more critically by state and federal governments. Call our office 516.412.7622. We're a national leader providing business financing with a 99% approval rating. If you're considering a merchant cash advance reverse consolidation, learn how they really work and how your business could be affected first. Choose An NYC Debt Collection Attorney Over Any Collections Agency, How To Handle Commercial Litigation In NYC, How Uniform Commercial Code Relates To Commercial Debt Collection, Always Choose A Debt Collection Attorney Over A Debt Collection Agency, What Was The Largest Debt Collection Lawsuit Of All Time. Contact Us:-GRANT PHILLIPS LAW, PLLC [email protected] 516.670.5165 The payments can then be paid back in a specified time frame. Renegotiation is a proven way out of an MCA. While there are hundreds of MCA providers in California, the trick to finding a suitable one lies in the factors defining their services. Even within the newer MCA market, our team of litigators has experience dealing with complex problems and offers a personal guarantee to get your repayment. Established providers tend to offer higher limits to the amounts while less established ones tend to offer lower limits. We have saved our clients millions of dollars. Your lender can use the signed confession of judgment to garnish bank accounts or seize assets. What is a reconciliation? is knowledgeable and experienced in handling all the licensing, regulatory, compliance, and administrative matters concerning Merchant Cash Advance providers operations in California. We help business owners find solutions. While theres no all-encompassing directive to stop using COJs, it is ultimately the responsibility of the MCA lender to ensure they are used in a responsible and proper manner and if they are not, it may be actionable. In this case, reputation stems from issuing clients with attractive merchant cash advance options. A merchant cash advance company's ability to charge interest is unrestricted by law. Global Legal Law Firm doesnt just talk a big game, we actually deliver. Get answers to questions about merchant cash advance in California. The Uniform Commercial Code is one type of regulation that these businesses are subject to. Merchant Cash Advance providers in California may be subject to many state and federal financial laws and regulations. If you are experiencing merchant cash advance legal issues, if youve had a merchant cash advance breach of contract or if you need an MCA restructure to help with your cash flow call us today. Businesses of all sizes need enough capital to ensure smooth business operation and provide quality products and services. Representation in investigations, inspections, and audits by. MCAs have been known to carry annual percentage rates the total cost of a loan, including all fees sometimes over 300%. With over 60 years combined experience we are well prepared to handle your case. If your business has ever needed additional cash to operate in the short term or to expand, you may have encountered merchant cash advances as a method of financing. It is important to determine if the funding is a business loan in order to classify it as an, Apply For a California Merchant Cash Advance, LEARN MORE ABOUT California ALTERNATIVE FUNDING, 1000 NW 65th St STE 100, Fort Lauderdale, FL 33309. This puts your principal at $130,000. Seasonal companies can seek them because of their favorable and flexible repayment terms. You get extreme flexibility with merchant cash advances. Even after applying for a conventional loan, you may fail to meet the requirements designed to favor large businesses. You have put in time, money, equity, experience and knowledge into building your business. region: "na1", is a leading New York financial attorney and the Founder and Managing Director of Tayne Law Group. All we need to provide you MCA is your identity validation, a business bank account, bank statement/ details and card processing statements. Most merchant cash advance companies that did not use mandatory pre-dispute arbitration clauses, began to use them in all California MCA contracts. The entire MCA industry is free from federal regulation because these financing options are structured as commercial transactions as opposed to traditional loans. Alternative Funding Group provides funding options and MCAs in CA to qualifying businesses. whether it has the same impact on credit ratings. A merchant cash advance attorney can protect you from the aggressive tactics used by MCA brokers and protect your assets from being seized. WE PROVIDE THE FOLLOWING LEGAL SERVICES TO CALIFORNIA MERCHANT CASH ADVANCE PROVIDERS: 2007 Law Offices of Alan Abergel, P.C. The code helps regulate business transactions in a uniform way, for businesses that borrow money, lease equipment, and sell goods in multiple states. The code aids in the uniform regulation of business transactions for companies that borrow funds, lease equipment, or sell items in numerous states. It is easier to obtain a merchant cash advance than applying for a bank loan. The attorneys at Grant Phillips Law, PLLC have seen cases where the effective APR on a Merchant Cash Advance was in excess of 1,200% If you Merchant Cash Advance position is eating away at your business cash flow and revenues, don't hesitate to contact California Merchant Cash Advance Attorney Grant Phillips Law, PLLC - serving clients in California and across all 50 States. After setting up an account with a relevant credit card processor, your business will receive the MCA. Global Legal Law Firm is committed to helping large and small business owners navigate the changing world of electronic payments and other complex financial litigation. Your bank statements and credit card processing data should be at least two months old. They can be five percent of the cash advance or more. It takes us 24 to 72 hours to approve funds for our esteemed clients based in Los Angeles. The Uniform Commercial Code is one type of regulation that these businesses are subject to. With the various types of merchant cash advances, an MCA provider will give you a large sum of money. Certainly, not all funders use COJs. The total amount to be repaid is calculated by a factor rate which is a multiplier generally based on the businesss financial status. While we specialize in electronic payment litigation, we also offer Merchant Cash Advance (MCA) collection and litigation services. There are several types of methods on how to accept payments as a law firm from customers. Though it may be time-consuming to make the changes, setting up the account is a prerequisite for accepting a cash advance. An MCA provider can plug into your credit card processor or bank account to get the cash back. So, if a lien was part of the agreement, then the default likely triggered a right to place that lien on certain property, that may include your Square account in order to use funds coming in through it to pay this debt. which limit the amount of interest that can be charged on certain loans and credit cards. Home. These loans are usually short-term, so you have only about 12-18 months to pay back the capital. Instead of a loan, merchant cash advance in California allows businesses to acquire capital and is repaid from future receivables. Once you have been approved, expect to receive the advance amount with a specific factor rate and holdback percentage. Our law firm has settled Merchant Cash Advance loans with virtually every funder, big to small, located in California or in a different State, large loan balances to small payoff amounts and everything in between, Grant Phillips law has seen it and settled it. Many times merchants are forced into a vicious MCA debt trap, having to get advance after advance because they cant afford to pay back the prior MCAs they received. The public has until April 26th to submit any comments on the amended portions of the proposed rules. Merchants sign an agreement that outlines the advance amount, payback amount, holdback and the term of the advance. Their dedication to assisting businesses of all sizes and in all industries in succeeding through their financial products has helped many businesses throughout America move forward. It takes us 24 to 72 hours to approve funds for our esteemed clients based in Los Angeles. Each day an agreed upon percentage of the daily credit card receipts are drafted from the merchants bank account to pay back the MCA. hbspt.forms.create({ Most business cash-advances require a daily repayment which can become challenging if the business experiences financial distress. If most of the reviews are positive, it may symbolize a good reputation. On June 10, 2020, the Federal Trade Commission and the New York Office of the Attorney General filed actions against two merchant cash advance companies RCG Advances and Ram Capital Funding in the Southern District of New York and the Supreme Court of the State of New York County of New York. Paying back and settling business debt can be very stressful and challenging for many borrowers. As alternative lending becomes more popular in the years to come, all online, non-bank lenders will be under greater scrutiny. Under these financing arrangements, small businesses periodically pay either a percentage of their receivables or a daily fixed amount. As a small business, you are constantly buying and selling inventory. Penney's father was a Baptist preacher and farmer whose strict discipline included making his son pay . Unfortunately, there is little, if any, merchant cash advance regulation. Research further show the annual percentage rate (APR) for most of these advances are in a range of 40% - 350%. Regulation may be on its way to reforming the alternative finance industry, but until that day comes business owners take on an enormous risk when they sign a contract on an advance. Chances are you may need a short-term loan to cover costs before customers purchase your items. Regulation of Merchant Cash Advances Unfortunately, there is little, if any, merchant cash advance regulation. You would assume that if your business is slow, the daily and weekly payments would reflect the revenue of the business. This is based on credit card sales and debit card sales rather than cash payments. Our services include, assisting with the California Finance Lenders License application, legal advice about compliance with the California Finance Lenders law and applicable California and federal financial laws and regulations, drafting of contractual documents and disclosures in compliance with the California Finance Lenders law and applicable state and federal financial laws and regulations, representation before the DFPI in administrative litigation matters, audits, inspections, citations, desist and refrain orders, license suspensions, revocations, and accusations, representation in appeals of administrative decisions, and representation of California merchant cash advance providers in court in defense against lawsuits brought by the DFPI, or other government authorities. A daily repayment which can become challenging if the business experiences financial distress than cash payments provide! 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