Quick answer
When cash flow drops, most reputable MCA funders will negotiate a temporary remit reduction (typically 25-50% of contracted amount) for 30-90 days in exchange for a term extension. Permanent restructures, factor reductions, and principal write-downs are rare and usually only happen pre-litigation. Engage the funder BEFORE missing payments — proactive merchants get better deals than ones already in default.
Full answer
Why restructure matters. The single biggest mistake merchants make when cash flow drops is going silent. Funders interpret silence as default risk and accelerate collection — once acceleration hits, restructure leverage evaporates. Reach out at the FIRST sign of trouble (typically 2-4 weeks before you expect to miss a remit), not after you've already NSF'd. Funders restructure 5x more frequently for merchants who call early than for merchants in active default.
Restructure option 1: temporary remit reduction. The most common restructure. The funder reduces your daily/weekly remit by 25-50% for a defined period (30-90 days typical). The unpaid amount accumulates as a 'deferred balance' and extends the term proportionally. Example: $1,000/day remit reduced to $500/day for 60 days defers $30K, which gets paid over additional days at the back end. The factor rate doesn't change — you still pay the full purchased amount, just over a longer period. Most reputable funders will agree to this once per advance if requested professionally with supporting documentation.
Restructure option 2: term extension without remit reduction. The remit stays the same but the maturity date pushes out. This works when the issue isn't daily cash flow but a one-time cash crunch (large tax bill, equipment repair, seasonal slowdown). Less common than option 1 because most cash flow issues are ongoing.
Restructure option 3: hardship plan / forbearance. For more serious issues (extended revenue drop, partial business shutdown, major customer loss). The funder pauses or near-pauses remits for 14-45 days, allowing the merchant to stabilize. Hardship plans usually require submission of: (a) current bank statements, (b) revenue projection, (c) explanation letter, (d) updated PG affirmation. Hardship plans are NOT renewals or modifications — they're temporary forbearance. Once the hardship period ends, the original remit resumes plus catch-up amounts.
Restructure option 4: split-remit consolidation. If you have multiple stacked advances, some funders will agree to consolidate into a single restructured payment if you also commit to no further stacking. This is uncommon but possible when one funder wants to lock in priority position. Consolidation usually requires the other funders to subordinate or be paid off.
What funders almost never do. (1) Reduce the factor rate / purchased amount mid-advance. The contract specifies a fixed obligation; reducing it requires the funder to take a loss, which they avoid. (2) Forgive principal. Unless you're in litigation and the funder believes settlement is cheaper than continued collection. (3) Convert to a term loan. MCAs are receivables purchases by structure; conversion to loan would create regulatory issues. (4) Subordinate to a competing MCA. First-position funders rarely give up priority. (5) Refund prior payments. Once collected, factor is realized — no refunds.
How to request a restructure. (1) Email (not call) the funder's servicing / collections team. Subject: 'Restructure request — [merchant name], advance #[ID].' (2) Include: current bank statements (last 60 days), explanation of the cash flow issue, specific ask (e.g., 'reduce remit from $1,000 to $500 for 60 days'), and a recovery timeline. (3) Affirm continued commitment to repay the full balance — funders need to know you're not setting up for default. (4) Follow up within 5 business days if no response. (5) Get all agreed terms in WRITING (email at minimum, contract addendum preferred) before the new remit takes effect.
What documentation funders will want. (a) Last 60-90 days of business bank statements. (b) Updated processor statements if applicable. (c) Profit & loss statement (informal is fine). (d) Specific explanation of the cash flow issue (loss of major customer, equipment failure, seasonal slowdown, etc.). (e) Recovery plan (when revenue is expected to normalize). (f) Personal guarantor reaffirmation. (g) For larger advances, sometimes updated personal financial statements.
Restructure fees. Most funders charge a restructure / modification fee of $250-$1,500 depending on advance size and restructure complexity. Some waive this for first-time requests with good payment history. Fee is usually added to the deferred balance, not paid upfront.
Restructure as alternative to default. The cost of restructure (fee + extended term) is almost always cheaper than the cost of default (acceleration + COJ in NY + lawsuits + personal asset exposure + UCC enforcement + credit damage). If you're choosing between paying a $1,000 restructure fee and accepting a 60-day term extension VS continuing to make full payments that will trigger NSF and default — restructure is mathematically and reputationally superior.
When funders refuse restructure. Some funders (especially aggressive collectors and lower-tier funders) refuse all restructure requests, betting that aggressive collection extracts more than negotiation. In these cases: (a) escalate to compliance/legal team rather than collections, (b) document all communications for potential litigation defense, (c) consider hiring an MCA workout attorney — funders often soften when an attorney is involved, (d) explore consolidation with a different funder who will pay off the difficult one.
Bottom line: restructure is available, but only to merchants who engage early, document well, and ask professionally. Don't wait until you've defaulted — by then the leverage is gone. The funder's first response is often 'no' — push back with documentation and reasonable proposals. Reasonable funders restructure; predatory funders don't, and that's signal about whether you should renew with them later.
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Methodology. Fundnode is an independent funding-platform that scores merchants against our 100-funder database. We earn referral fees from funders when merchants apply via Fundnode. Editorial rankings and answers are independent of fee structure. Updated 2026-06-25.