MCA UCC 9-406 Notices: Payment Holds & Your Options

in MCA Legal Advice, Merchant Cash Advance

UCC § 9-406 LIEN DEMAND NOTICES AND MCA CREDITOR LAWSUITS

One of the most effective pressure tools a merchant cash advance provider has is the UCC lien demand notice. What is a UCC § 9-406 lien demand notice? It is a letter sent by an MCA funder, its attorneys, or its collection representatives to a business's customers, payment processors, insurers, or other payors. The letter claims the funder has rights to the business's receivables and instructs the recipient to pay the funder directly instead of the business. Some funders send these notices to one or two customers. Others send them to multiple customers, processors, or payors they can identify based on information...

26 September

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What to Expect and How to Contend With High-Pressure and Aggressive Merchant Cash Advance Collection Tactics

By Anthony Rumore, Esq.

in MCA Legal Advice, Merchant Cash Advance

What to Expect and How to Contend With High-Pressure and Aggressive Merchant Cash Advance Collection Tactics

MCA collection pressure can begin before a missed payment and escalate quickly once one occurs. Here is what business owners can expect and how to respond. This article provides insight and information for business owners dealing with Merchant Cash Advance (MCA) obligations or considering their options when MCA payments begin placing pressure on business cash flow. Merchant cash advances are commercial financing arrangements and may be structured as purchases of future receivables or revenue rather than traditional business loans. The first thing to recognize is that MCA transactions can operate differently from traditional bank financing. Banks and traditional finance companies operate within...