How to Get Out of a Merchant Cash Advance: 7 Legal Options

Owners trapped in an MCA usually think they have two options: keep paying or close the business. Neither is true. Here are seven legitimate ways out.

1. Renegotiate the remittance

The simplest exit: call the funder, document the cash-flow problem, and ask for a reduced daily or weekly amount over a longer term. Funders prefer this to default.

2. Restructure all positions at once

If you have multiple MCAs, restructuring them together produces better terms than renegotiating them one-by-one. Each funder is told the others are also at the table.

3. Lump-sum settlement

Raise 40–60% of the balance and offer it as a final payoff. Discounts are deepest when the file is in distress.

4. Challenge the contract

Many MCA contracts contain provisions courts have struck down as disguised loans (usury), or include unenforceable Confession of Judgment language. A contract challenge can void the obligation entirely.

5. Vacate a Confession of Judgment

New York and several other states have restricted COJ enforcement against out-of-state businesses. An attorney can move to vacate, oppose entry, or negotiate immediate stays.

6. ACH revocation + restructure

Revoking ACH authorization is legal, but it must be paired with a parallel restructuring offer. Doing it without a plan accelerates lawsuit risk.

7. Bankruptcy (last resort)

Chapter 11 Subchapter V was designed for small businesses with debts under $7.5M and can discharge or restructure MCA obligations. It is powerful but expensive and public.

Which one fits you?

It depends on how many positions you have, whether you are current, whether a COJ exists, and your willingness to take a credit hit. We map cases to the right exit every day — start with a free review.