Negotiating With MCA Lenders
“So They Have All the Leverage, Right?”
That is how our sales team answered an owner who asked why he couldn't simply negotiate on his own. The steps above are the same steps a professional takes. What changes at scale is who is on the other side of the call, what the agreement gives them, and how many conversations you are running at once.
They Negotiate for a Living. You Are Doing It Between Customers.
Merchant cash advance companies keep professional negotiators on staff. They take hardship calls every day, they know their own agreements line by line, and they see far more of these requests than any one owner ever will. The owner is usually doing it between jobs, without a feel for what settlement amount that funder tends to accept.
“...when you sign these loan agreements, you give up a lot of rights.”
Our sales team, explaining the agreements to an owner
Without Credible Legal Backing, There Is Little Reason to Settle
An MCA is generally structured as a purchase of future receivables priced with a factor rate, not a loan, which is why usury laws and lower interest rates are usually not the lever owners expect. The agreement gives the funder the daily or weekly payment, often a personal guarantee and sometimes a COJ. Funders have no incentive to settle with a single merchant who has no credible legal backing behind them, and they deliberately stall individual merchants while collections escalate.
“They have no, no reason to really work anything out with you because they have all the leverage.”
Our sales team
Admitting Hardship Without Protection Can Backfire
Telling an MCA creditor the business cannot pay is honest, and it is also information the funder can act on. Admitting hardship directly to a lender without protection already in place can invite an acceleration or a faster legal move, not sympathy. Depending on the agreement, that could be a UCC lien with notices to your customers, a merchant cash advance lawsuit, or a move on a confession of judgment. If you signed a personal guarantee, a funder that sues may name you as well as the business, which is where personal liability comes in.
“...we know that you're in a hardship, but the creditors don't know that you're in a hardship.”
Our client success team
Four Positions Means Four Negotiations at Once
Every position is its own funder, its own debit and its own deal. With several MCAs, you are running separate negotiations on separate schedules, and each funder has little reason to give ground when it knows the cash it frees up may go to the others. One funder may offer a weekly plan while another demands the full balance. Keeping every conversation consistent and in writing becomes a second job on top of running the business and managing its cash flow.
“Okay, so two of them I pay weekly. One of them is 550, one of them is 1350. And then two of them are daily five days a week. That one of them is 255. And one of them is 250.”
A business owner with four positions, on a call with us
“...the creditors don't care about you or your business. The only thing that they care about is collecting the money that you owe them.”
Our client success team
