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If you’re searching for ‘MCA defense lawyers,’ you already know something is wrong — and it’s getting worse. Confessions of judgment, UCC-1 liens, personal guarantees, and daily ACH debits — and know how to dismantle them. California’s SB 1235 disclosure requirements and the DFPI’s enforcement authority make it one of the most regulated states for MCA transactions, giving California business owners more legal tools than business owners in most other states. Here are the three best options in 2026.
Important: Delancey Street is not a law firm. They’re a specialized MCA debt settlement company that works with a nationwide network of licensed attorneys — and that distinction matters. Their attorneys handle COJ challenges, usury defenses, SB 1235 disclosure violations, UCC lien disputes, funder negotiations, and settlement execution on behalf of California business owners. Their network is built around New York’s dual usury framework — which governs the vast majority of MCA contracts regardless of whether your business operates in Los Angeles, San Francisco, San Diego, San Jose, or Sacramento — and the evolving appellate case law that is reclassifying MCAs as loans subject to interest rate caps.
Where Delancey Street separates from every other firm is MCA-specific legal firepower. Their attorneys don’t just negotiate — they challenge. They use California’s prohibition on COJs (Cal. Code Civ. Proc. § 1132), raise criminal usury defenses when effective APRs exceed 25%, identify SB 1235 disclosure violations that weaken the funder’s legal position, dispute overbroad UCC-1 filings with the California Secretary of State, and use the NY Attorney General’s $1 billion Yellowstone Capital settlement as precedent. Over $100M settled. No upfront fees. Results-based pricing.
Important: National Debt Relief is not a law firm and is not an MCA defense specialist. They handle general unsecured business debts — credit cards, vendor accounts, lines of credit — but they do not challenge confessions of judgment, file usury defenses, or dispute UCC liens. If your California business debt is primarily traditional unsecured debt, National Debt Relief is a strong, proven option.
Important: CuraDebt is not a law firm and is not an MCA defense specialist. If your California financial situation involves both MCA debt and tax obligations — including California Franchise Tax Board and CDTFA issues — CuraDebt can handle the tax side while a firm like Delancey Street handles the MCA defense.
MCA defense is a specific subset of business debt law focused on protecting business owners from the legal instruments that merchant cash advance funders use to collect: confessions of judgment, UCC Article 9 liens, personal guarantee enforcement, and aggressive daily ACH withdrawals. For California business owners, MCA defense comes with unique advantages — California has enacted some of the most aggressive MCA-related regulations in the nation.
California explicitly prohibits confessions of judgment under Cal. Code Civ. Proc. § 1132, meaning any COJ obtained from a California business owner is void as a matter of California public policy. California’s SB 1235 (effective December 2022) requires commercial financing providers, including MCA funders, to disclose the total cost of financing, APR equivalents, and other key terms. And AB 1864 established the Department of Financial Protection and Innovation (DFPI) with broad enforcement authority over commercial financing, including MCA products.
The agreement you signed for the MCA is probably written totally in the lender’s favor — we have yet to see a single MCA contract that is fair. That’s why you need an attorney who knows how to attack the contract from the outside: California’s COJ prohibition, SB 1235 disclosure violations, usury challenges under both California and New York law, procedural defects, unconscionability arguments, and the growing body of case law reclassifying MCAs as loans.
The moment your California business misses a merchant cash advance payment, the clock starts ticking. Defaulting on an MCA isn’t like traditional default — it’s governed by Uniform Commercial Code (UCC) Article 9 provisions as adopted by California. The consequences are immediate: frozen bank accounts, UCC-1 liens filed with the California Secretary of State, or personal asset seizures if you signed a guarantee.
However, California business owners have significant protections. California’s prohibition on COJs means lenders cannot use this weapon against you. And if the MCA funder failed to comply with SB 1235’s disclosure requirements, that failure can be used as use in settlement negotiations and legal challenges.
California explicitly prohibits confessions of judgment under Cal. Code Civ. Proc. § 1132. This means any COJ clause in your MCA contract is void as a matter of California public policy — regardless of what the contract says about governing law. Even if your MCA contract designates New York as the governing jurisdiction, a California court will not enforce a COJ against a California business owner.
Strategy 1: Void the COJ. If an MCA lender has filed a COJ against your California business in New York, your attorney can challenge it on two grounds: (1) California’s public policy prohibition on COJs, and (2) the 2019 CPLR §3218 amendment banning COJ enforcement against out-of-state defendants. This dual protection makes California one of the strongest states for COJ challenges.
Strategy 2: Use SB 1235 Violations. If the MCA funder failed to provide the required disclosures under SB 1235 — including APR equivalent, total repayment amount, and payment frequency — this failure strengthens your negotiating position and may provide grounds for enforcement action through the DFPI.
You took a second MCA to pay the first. Then maybe a third. Now the daily payments consume 30% of your revenue — and you can’t make payroll. Under UCC § 9-607, lenders can place UCC-1 liens on receivables filed with the California Secretary of State, which makes it impossible to get new financing.
Strategy 1: Consolidate via Ch. 11 or State Law. Chapter 11 filed in a California bankruptcy court usually lets you pause collections and reclassify MCAs as unsecured debt. The California Constitution (Article XV, § 1) caps interest at 10% per annum for non-exempt loans. While many commercial lenders are exempt under the California Finance Lenders Law, MCA funders operating without a CFL license may not qualify for this exemption — and if the MCA is reclassified as a loan, the 10% cap applies.
Strategy 2: Use Cash Flow Realities. Provide lenders with 6 months of bank statements showing unsustainable withdrawals. Many business debt settlement companies focus on your new cash flow reality to show the lender that settlement is their best option.
Lenders always presume you’re lying. Sometimes the only way forward is hiring a business debt settlement company with real relationships with the lenders. You don’t want to hire a scam company.
MCA contracts often mask APRs exceeding 100% — sometimes 200% or more. California has a complex usury framework. The California Constitution (Article XV, § 1) caps interest at 10% for non-exempt loans, but the California Finance Lenders Law (Cal. Fin. Code § 22000 et seq.) exempts licensed lenders. Critically, California’s SB 1235 now requires all commercial financing providers — including MCA funders — to disclose the APR equivalent. This disclosure requirement has exposed the true cost of many MCA products and strengthened usury reclassification arguments.
Strategy 1: Usury as a Defense. A $50K advance at a 1.4 factor rate costs $70K over 6 months — approximately 150% APR. Under New York law, which governs most MCA contracts, crossing the 25% criminal usury threshold voids the contract. California’s SB 1235 disclosure requirements can be used to demonstrate that the funder knew the effective APR was usurious. The NY AG’s $1 billion Yellowstone Capital settlement provides powerful precedent.
Strategy 2: DFPI Enforcement. If the MCA funder failed to comply with SB 1235 or operates without proper licensing under the California Finance Lenders Law, the DFPI can take enforcement action. An MCA defense attorney can file a complaint with the DFPI to trigger an investigation, which creates additional pressure on the funder to settle.
Regardless of whether your business operates in Los Angeles, San Francisco, San Diego, San Jose, or Sacramento, the legal framework governing your MCA contract is almost certainly New York law. Most MCA funders are headquartered in New York, and nearly all MCA contracts designate New York courts as the governing jurisdiction.
Here’s why that actually works in your favor. New York operates a dual usury framework: civil interest is capped at 16% annually, while any effective rate above 25% constitutes criminal usury. California business owners get the benefit of both worlds: New York’s criminal usury threshold for contract challenges, and California’s COJ prohibition, SB 1235 disclosure requirements, and DFPI enforcement authority for additional use.
The CFPB has separately classified merchant cash advances as “credit” under the Equal Credit Opportunity Act. For California business owners, this federal classification adds a third layer of protection on top of California’s state regulations and New York’s usury framework.
The difference between a good MCA defense attorney and a bad one is the difference between settling your $200K in MCA debt for $80K and losing your business. Here are the three questions that matter:
1. Have you handled MCA defense specifically? Not consumer debt. Not medical debt. MCA debt. Ask how many COJs they’ve challenged, how many usury defenses they’ve raised, and whether they understand California’s SB 1235 disclosure requirements.
2. Do licensed attorneys handle the legal work? Settlement negotiation alone is not MCA defense. You need licensed California attorneys who file motions, challenge UCC liens, subpoena funder underwriting documents, and draft enforceable settlement agreements.
3. What are the fees and when do you pay? Legitimate firms charge 18–25% of the enrolled debt amount, collected only after delivering results. Any firm that charges upfront fees is violating FTC guidelines — walk away.
Your search is over. Here are the three top-rated firms serving California business owners dealing with MCA debt in 2026. Only one — Delancey Street — offers true MCA defense with attorney-coordinated COJ challenges, usury defenses, SB 1235 violation claims, and UCC lien disputes.
The only firm on this list that provides true MCA defense for California business owners: using California’s COJ prohibition, SB 1235 disclosure violations, usury defenses, UCC lien disputes, and emergency motions to unfreeze bank accounts. Over $100M settled. No upfront fees. All 50 states.
Not an MCA defense specialist. Handles general unsecured business debt. No COJ challenges, no usury defenses, no SB 1235 claims. If your California business debt is primarily traditional unsecured debt, they are a proven option.
Not an MCA defense specialist. Handles business debt and IRS/state tax resolution. Best used alongside an MCA defense firm if your California business also has FTB or CDTFA tax obligations to resolve.
COJ filed against you? Bank account frozen? Daily ACH debits destroying your cash flow? Delancey Street’s attorney network uses California’s COJ prohibition, SB 1235, and usury defenses. Over $100M settled. Free consultation.
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