My MCA payment is too high — what should I do?

Full answer

MCA payments become unmanageable for a predictable reason: the daily/weekly fixed-amount remit was sized to your revenue at signing, and your revenue has dropped. Or you took a second/third MCA (stacked) and the combined remits exceed your gross margin. Either way, this is fixable if you act early — much harder once you've missed payments.

Step 1 — Reconciliation: Most legitimate MCA contracts include a reconciliation clause. If your monthly revenue has dropped materially (typically 20%+) from what was projected at signing, you can request a true-up to the contracted holdback percentage. Provide bank statements showing the revenue decline; the funder should reduce your daily remit. Some funders honor this readily; others stall — push in writing, keep records.

Step 2 — Restructure or term extension: If reconciliation isn't enough, call the funder's collections team (not your ISO/broker) and request a restructure. Common options: reduced daily remit with extended term, partial deferment (1-4 weeks of reduced or paused payments), or a lump-sum settlement at a discount. Funders prefer this over default — they recover more — but you have to ask. Document the conversation.

Step 3 — Consolidation or SBA refinance: If you qualify for a longer-term, lower-cost product (SBA 7(a), bank line of credit, or a true consolidation lender like Forward Financing's consolidation product), refinancing the MCA debt onto a 5-10 year amortization can drop monthly debt service by 60-80%. This is the cleanest exit but requires 650+ FICO and 2+ years operating typically.

Step 4 — Legal consultation before default: If steps 1-3 don't work, talk to an MCA-experienced attorney BEFORE missing a payment. Default triggers a Confession of Judgment (COJ) in many MCA contracts — the funder can freeze bank accounts in 1-2 days. A lawyer can sometimes negotiate a settlement preemptively, or advise on protective steps. The $500-2,000 consult fee saves orders of magnitude more.

What NOT to do: (1) Stack a new MCA to make payments on the old one — the daily remit math gets worse, not better. (2) Stop ACH-debits unilaterally — accelerates default and COJ. (3) Ignore the funder's calls — silence makes funders move to enforcement faster. (4) Sign a 'reverse consolidation' from a sketchy broker without independent review — many of these are predatory and worsen the situation.

Bottom line: act early, communicate in writing, and pursue legitimate restructure paths before considering any new debt. The merchants who recover from MCA overload do it through reconciliation/restructure/refinance — not by stacking or ghosting.

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