Protecting Maryland Merchants: Grant Phillips Law - Your Merchant Cash Advance Attorney

 Dozens of additional statutes and laws exist designed to PROTECT THE CONSUMER and govern the creditors. One slip up on any of these laws and a competent attorney can litigate and sue the creditor for such a violation. Common examples of violations are a creditor or lender not offering the client the necessary notices of increases in their APR (annual percentage rate), charging unexplained fees, or mailing statements late. The potential violation list goes on and on. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 When a debtor hires a debt expert or company additional problems arise. There is the too common issue of multiple creditors and the inability of the expert or debt settlement company to get ALL of the debtor’s creditors into one all-encompassing settlement. Worse yet, is the failure of the debt settlement company to contact the true and actual creditor making sure the party they are “negotiating” with is the true debt holder and not a third party collection agency without authorization to issue settlements, thus leaving the debtor open to collections down the road. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 The new law imposes multiple disclosure requirements similar to TILA (Truth in Lending), on funders and providers of corporate financing including Fintech, Factors, and Merchant Cash Advance transactions. Prior to enactment, there was no uniform methodology for the disclosure of vital components of the credit being extended to businesses, such as the total amount being borrowed, the total amount of repayment, the total interest cost, annual percentage rate, and a host of other disclosures, to be discussed later in this article https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 This is significant development since New York’s Commercial Finance Disclosure Law (CFDL) went into effect August 1st, 2023 and in the law the CFDL has extended disclosure requirements ordinarily required for consumer lending to commercial financing instruments such as a merchant cash advance. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/

 The intent of S.B 5470 is to provide corporate and small business borrowers with more transparency surrounding their taking of credit, in order to allow for better, more informed decisions, a clearer understanding of how much is being borrowed and under what terms and to provide a corporate borrower with the ability to compare different offers of credit. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 What arrived next was enormous growth in a previously obscure lending instrument, ubiquitously known as a Merchant Cash Advance. A seemingly legal transaction whereby a predatory lender is permitted to charge what ordinarily would be considered usurious interest, without being guilty of breaking the law. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 This is significant development since New York’s Commercial Finance Disclosure Law (CFDL) went into effect August 1st, 2023 and in the law the CFDL has extended disclosure requirements ordinarily required for consumer lending to commercial financing instruments such as a merchant cash advance. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/

 The final rules limit the CFDL to transactions where the recipient is directed or managed from New York or is a resident of New York. This is very similar to California’s law. Both NY and CA allow a Merchant Cash Advance Funder to rely on the business address provided by the recipient in its application for financing to make the determination. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/

 The final rules are a good start, but fall short in several areas. For example an MCA Funder is exempt from full disclosure if they are “partnered” with FDIC insured banks. Another shortfall is the inclusion of a $2,500,000 cap. Thus, commercial financing in excess of $2.5M is exempt from the CFDL. Hardly ideal. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/

 2010 saw a large increase in MCA loan origination. This growth can be attributed to the economic circumstances and fledging economy at that time. It was a perfect combination of circumstance and timing. Small business lending had all but dried up, demand for funding had risen sharply and the resulting turmoil presented both the conditions and timing necessary for the MCA industry to grow exponentially. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 Notwithstanding the lack of DFS guidance thus far, the law is categorical in its underlying intent and drive. New York is looking out for small businesses at home and across the country. S.B 5470 is groundbreaking in so far as it mandates that certain disclosures be provided to corporate borrowers, thereby providing a corporate borrower with protection from lending abuses perpetrated on small businesses and merchants across the United States. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 The protocol and format of how lenders will issue, maintain and comply with the new law and the manner by which lenders will be monitored, will be prescribed by The New York Department of Financial Services (DFS). At the time of writing this article, the DFS has yet to issue guidance or provide instruction on Format and Compliance. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 Dozens of additional statutes and laws exist designed to PROTECT THE CONSUMER and govern the creditors. One slip up on any of these laws and a competent attorney can litigate and sue the creditor for such a violation. Common examples of violations are a creditor or lender not offering the client the necessary notices of increases in their APR (annual percentage rate), charging unexplained fees, or mailing statements late. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 In other words “We will reduce your debt by x% but we still reserve the legal right to sue you and come after you for the x% we temporarily forgave at a later time when you have income or assets.” Often such judgments stay in affect for 20 years and lead to wage garnishments, liens and writs of possession. A qualified attorney will make sure that any such settlement releases the debtor from any future deficiency judgments. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

In today's competitive business environment, companies face numerous challenges that can push them into financial difficulties. One of the most significant challenges involves debt—when businesses accumulate more debt than they can manage, it can become a major hindrance to growth or even lead to closure. The role of a Business Debt Attorney becomes critical in these situations, as they provide the necessary legal expertise to navigate debt relief options and protect the company from legal and financial repercussions. Understanding the complexities of debt and the solutions available can make the difference between business success and failure. Debt relief is not just a quick fix but a structured process that requires careful legal and financial planning. Having access to the Best Business Debt Relief strategies is essential for businesses to regain control over their finances. With expert legal assistance, companies can avoid common pitfalls and identify the most beneficial path...

 “New York State Adopts Truth In Lending (TILA) – Like Disclosure Law for Business Loans, including Merchant Cash Advance and Purchase of Future Receivables.” https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 With an abundance of new regulation, credit underwriting standards inevitably increased to such an extent, that most small businesses were left out in the cold, unable to obtain working or start-up capital, thus leaving a massive void in the lending to small business space. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 When a debtor hires a debt expert or company additional problems arise. There is the too common issue of multiple creditors and the inability of the expert or debt settlement company to get ALL of the debtor’s creditors into one all-encompassing settlement. Worse yet, is the failure of the debt settlement company to contact the true and actual creditor making sure the party they are “negotiating” with is the true debt holder and not a third party collection agency without authorization to issue settlements, thus leaving the debtor open to collections down the road https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 Provided certain disclosures are met pursuant to S.B. 5470 and that risk to changes in receivables are carried and borne entirely by the lender, coupled with several other legal criteria (the specifics of which are not applicable for this article), and it is possible for a bona fide Merchant Cash Advance, (i.e. in compliance with all laws) to exist. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 Only a Consumer National Debt Relief Attorney Can Help You With Total & Lasting Debt Elimination! This applies to most forms of debt, including but not limited to Merchant Cash Advance Loans, Payday Loans, Hard Money Loans, IRS Tax Debt, Medical Bills, Credit Card Debt and in certain instances even Student Loan Debt. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 The new TILA-like Disclosure requirements were signed into law on December 23rd of 2020 with an original commencement date of June 21, 2021. However, since passing S.B. 5470 the New York Senate has provided additional guidance and updates (In March 2021), and included in this update is a new date for commencement of the law to begin January 1st, 2022. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 As a direct result of the economic crisis back then, an environment for alternative lending opened to meet small business demand and plug the lending gap left by conventional banking institutions. The predominant and favorite tool predatory lenders leaned upon, was the offering of a Merchant Cash Advance to an unsuspecting small business owner. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 The new TILA-like Disclosure requirements were signed into law on December 23rd of 2020 with an original commencement date of June 21, 2021. However, since passing S.B. 5470 the New York Senate has provided additional guidance and updates (In March 2021), and included in this update is a new date for commencement of the law to begin January 1st, 2022. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 When a debtor hires a debt expert or company additional problems arise. There is the too common issue of multiple creditors and the inability of the expert or debt settlement company to get ALL of the debtor’s creditors into one all-encompassing settlement. Worse yet, is the failure of the debt settlement company to contact the true and actual creditor making sure the party they are “negotiating” with is the true debt holder and not a third party collection agency without authorization to issue settlements, thus leaving the debtor open to collections down the road. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 As an attorney licensed & practicing in Florida, New York and New Jersey, with a focus on Total Consumer Debt Relief, I am receiving more and more clients, who were once signed into an alleged debt settlement program, hired a non-attorney to address their debt or had already paid exorbitant amounts of money to such companies, and yet, their debt was NOT settled. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 The intent of S.B 5470 is to provide corporate and small business borrowers with more transparency surrounding their taking of credit, in order to allow for better, more informed decisions, a clearer understanding of how much is being borrowed and under what terms and to provide a corporate borrower with the ability to compare different offers of credit. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 Beginning early 2010, after the Great Recession, when the American housing market blew up and the world fell into a financial crisis, conventional banking institutions, for example Chase Bank and Citi, were unwilling to extend credit to small businesses. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 New York State, by all accounts the haven State for Merchant Cash Advances, ironically is also one of the first States to enact laws that require certain consumer like disclosures even for several commercial loans. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/

The final rules require any commercial financing that incorporates a Broker that the MCA Funder must inform the Business receiving the MCA in writing of how and by whom the broker will be compensated. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/  

 Worse yet, the Government’s intervention in saving the banking industry, brought with it more regulation, laws and strict underwriting standards, making it exceedingly unlikely for a small business to obtain necessary financing. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 Dozens of additional statutes and laws exist designed to PROTECT THE CONSUMER and govern the creditors. One slip up on any of these laws and a competent attorney can litigate and sue the creditor for such a violation. Common examples of violations are a creditor or lender not offering the client the necessary notices of increases in their APR (annual percentage rate), charging unexplained https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 Notwithstanding the lack of DFS guidance thus far, the law is categorical in its underlying intent and drive. New York is looking out for small businesses at home and across the country. S.B 5470 is groundbreaking in so far as it mandates that certain disclosures be provided to corporate borrowers, thereby providing a corporate borrower with protection from lending abuses perpetrated on small businesses and merchants across the United States. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 When a debtor hires a debt expert or company additional problems arise. There is the too common issue of multiple creditors and the inability of the expert or debt settlement company to get ALL of the debtor’s creditors into one all-encompassing settlement. https://grantphillipslaw.com/tackle-all-your-debt-with-a-debt-relief-attorney/

 The intent of S.B 5470 is to provide corporate and small business borrowers with more transparency surrounding their taking of credit, in order to allow for better, more informed decisions, a clearer understanding of how much is being borrowed and under what terms and to provide a corporate borrower with the ability to compare different offers of credit. https://grantphillipslaw.com/new-york-enacts-apr-disclosure-laws/

 2010 saw a large increase in MCA loan origination. This growth can be attributed to the economic circumstances and fledging economy at that time. It was a perfect combination of circumstance and timing. Small business lending had all but dried up, demand for funding had risen sharply and the resulting turmoil presented both the conditions and timing necessary for the MCA industry to grow exponentially. https://grantphillipslaw.com/merchant-cash-advance-101-explained/

 This is significant development since New York’s Commercial Finance Disclosure Law (CFDL) went into effect August 1st, 2023 and in the law the CFDL has extended disclosure requirements ordinarily required for consumer lending to commercial financing instruments such as a merchant cash advance. https://grantphillipslaw.com/new-york-mca-final-disclosure-laws/