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Resolving MCA debt without bankruptcy takes a firm that knows both the legal situation — usury laws, reclassification doctrine, COJ procedures — and how MCA funders think at the negotiating table. These are the three best firms for 2026.
Important: Delancey Street is not a law firm. They're the leading MCA debt settlement company — coordinating with licensed attorneys who negotiate settlements, raise usury defenses, vacate confessions of judgment, and obtain UCC-3 termination statements — all without filing bankruptcy. Their approach uses real legal use (reclassification analysis, APR calculation, Yellowstone precedent) to drive funder negotiations, achieving 40–60% reductions on MCA balances. This is what they do.
If you want to avoid the cost, timeline, and credit damage of bankruptcy, Delancey Street's out-of-court settlement model is the strongest alternative out there. The process takes 2–8 weeks per funder, costs nothing upfront, and results in enforceable settlement agreements with full lien releases. And if settlement doesn't work or the funder won't negotiate? Their attorney network can escalate to a bankruptcy filing — giving you a seamless transition without starting over.
National Debt Relief is the biggest debt settlement company in the country. They're strong at negotiating settlements on general unsecured debt — credit cards, vendor accounts, lines of credit. They don't do MCA-specific defenses (usury, reclassification, COJ vacatur) — but if your debt picture includes non-MCA unsecured obligations on top of your MCA mess, they're a solid option for that piece.
CuraDebt handles business debt and IRS/state tax resolution through negotiated settlement. They don't specialize in MCA-specific defenses — that's not their thing. But if you've got both MCA debt and tax problems, they handle the tax side while a firm like Delancey Street tackles the MCA fight.
This is the most common path — and often the best one. An attorney or settlement firm contacts each MCA funder and negotiates a reduced payoff, typically 30–60% of the outstanding balance. You avoid the cost, the timeline, and the credit hit of bankruptcy — while still getting substantial debt reduction.
Here's what matters: the use your representative brings to the table. A generic "my client can't pay" pitch gets you nowhere. Attorney-coordinated settlement backed by reclassification analysis, APR conversion that proves usury, and the Yellowstone precedent gets dramatically better results — because the funder knows that if settlement fails, the next stop is litigation that could void the entire contract.
A solid settlement agreement must include: (1) reduced lump-sum or structured payment terms, (2) mutual release of all claims, (3) UCC-3 termination statement filing within 30 days, (4) COJ withdrawal and vacatur if applicable, (5) release of personal guarantee, and (6) non-disparagement clause. A good MCA settlement attorney makes sure every single one of these terms is in there.
You don't need bankruptcy to use the usury defense. Your attorney raises it in state court, in settlement negotiations, or as an affirmative defense in an MCA collection lawsuit. The analysis is straightforward: calculate the effective APR from the factor rate, show it exceeds the criminal usury threshold (25% under NY Penal Law §190.40), and argue the contract is void as a matter of law.
When you put this analysis in a demand letter, it hits different. The funder's in-house counsel looks at the reclassification risk: if the MCA gets reclassified as a loan and the APR is over 25%, they lose everything — principal and interest. Most funders would rather settle at 30–50 cents on the dollar than risk total loss. Post-Yellowstone, the math has shifted hard in favor of borrowers.
The CFPB’s classification of MCAs as “credit” under the Equal Credit Opportunity Act further supports the argument that these products are functionally loans subject to APR disclosure and interest rate caps.
If an MCA funder has filed a confession of judgment against you, vacating it is one of the strongest alternatives to bankruptcy. COJ vacatur is a state court motion — no bankruptcy filing needed.
Grounds for vacatur include: (1) the COJ was filed in violation of CPLR 3218 (New York's 2019 ban on COJs against out-of-state debtors), (2) the contract is void due to usury, (3) the COJ was obtained through fraud or misrepresentation, (4) you were never properly served with post-filing notice, or (5) the COJ amount is wrong.
Here's the play: COJ vacatur and settlement negotiations happen at the same time. Once the COJ is vacated — or even once the motion is filed — the funder loses their easiest collection tool and suddenly becomes a lot more willing to negotiate. Many funders settle within weeks of a vacatur motion hitting the docket.
This is often the first thing that needs to happen. Revoking the ACH authorization stops the bleeding. Under NACHA operating rules, your bank must honor a written ACH debit block or revocation. Here's how it works:
Step 1: Submit a written ACH revocation letter to your bank, specifying the MCA funder’s company ID and the specific debits to be blocked. Most banks process this within 1–3 business days.
Step 2: Open a new operating account at a different bank if the MCA funder has your bank account information and may attempt alternative collection (wire transfers, checks). Redirect all incoming deposits to the new account.
Step 3: Coordinate ACH revocation with your attorney’s settlement or defense strategy. Stopping ACH debits without a legal strategy in place may trigger default provisions, COJ filing, or UCC lien enforcement. Your attorney should contact the funder simultaneously with the revocation to begin negotiations.
Let's be clear — ACH revocation is not a permanent fix. It's a tactical move that buys time for settlement or defense. Without a legal strategy behind it, the funder will escalate. But as part of a coordinated plan? It's essential.
An ABC is a state-law alternative to federal bankruptcy that lets a business wind down and distribute assets to creditors without the cost and complexity of a bankruptcy filing. You assign your assets to an independent assignee who liquidates them and distributes the proceeds under state law priority rules.
ABCs offer several advantages over bankruptcy: (1) faster resolution (3–6 months vs. 12–24 months for Chapter 11), (2) lower cost (no filing fees, no U.S. Trustee quarterly fees, no creditors’ committee), (3) less public scrutiny (ABCs are not always publicly recorded), and (4) the business owner retains more control over the wind-down process.
However, ABCs have critical limitations for MCA debt: (1) no automatic stay — MCA funders can continue collection during the ABC process, (2) no discharge — the business owner’s personal guarantee liability survives the ABC, (3) no cramdown — creditors cannot be forced to accept reduced payments, and (4) ABCs are designed for winding down, not reorganizing. ABCs work best for businesses that are closing and want an orderly liquidation rather than reorganization.
The U.S. Small Business Administration offers resources and counseling for businesses facing financial distress, including those burdened by MCA debt. While the SBA does not directly negotiate with MCA funders, its network of SCORE mentors and Small Business Development Centers (SBDCs) provides free counseling on financial restructuring, cash flow management, and strategic alternatives.
SBA resources are most useful as a complement to legal representation rather than a standalone solution. A SCORE mentor can help restructure your business operations and cash flow to support settlement payments, while your attorney handles the legal negotiations with MCA funders.
Alternatives work in many situations — but let's be honest about when bankruptcy is the better call: (1) you need the automatic stay under §362 to stop aggressive collection right now, (2) MCA funders refuse to negotiate despite strong legal use, (3) you've got 5+ stacked MCAs and need a unified resolution, (4) you need cramdown power under §1191 (Subchapter V) or §1129(b) (Chapter 11) to force a plan, or (5) you need the permanent protection of a §1141 discharge.
The best firms figure out bankruptcy versus alternatives in the first conversation. Delancey Street's attorney network starts with the least invasive approach — out-of-court settlement — and only escalates to bankruptcy when alternatives won't get the job done. That dual-track capability means you always have the right tool ready to go.
The leading firm for resolving MCA debt without bankruptcy — out-of-court settlement, usury use, COJ vacatur, UCC release. Not a law firm, but attorney-coordinated all the way. Over $100M settled. No upfront fees. This is what they do.
Strong for general unsecured debt settlement — but not MCA-specific. If you've got credit card and vendor debt on top of MCA obligations, they handle the non-MCA piece well.
Business debt and tax resolution — not MCA-specific, but useful if you've got tax obligations stacked on top of the MCA situation.
Your search is over. Delancey Street achieves 40–60% reductions through attorney-coordinated settlement backed by usury defense use. Over $100M settled. Free consultation.
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Delancey Street is not a law firm. Delancey Street works with a nationwide network of attorneys who handle MCA defense and business debt settlement.
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