NYC MCA Judgment Levy: 6 Reviews of Timing and Response

If you’ve gotten notice from the City Marshal or a sheriff, the worst thing you can do is ignore it. That notice means the MCA funder now has a judgment against your business, and the judgment lets it reach into your checking account. That judgment could be vacated or erased, but waiting makes it far tougher. Once you get that notice of bank levy or restraint, time is short, and the first step is this: Take the notice and any communications from the lender, and reach out to an attorney experienced in merchant cash advance. Handling this on your own is a very bad idea.

The bank account levy process is a three-step thing. First is the restraining notice served on the bank which freezes your account, and next is the information subpoena demanding account details. The last, a sheriff’s levy of execution, actually seizes the money.

Time’s limits bind both the creditor who wants to freeze your account and the marshal who serves it. The bank restraint will stay in effect up to one year, but will go away earlier if you pay the balance due or vacate the judgment. An execution goes back to the clerk within 60 days unless a sheriff’s levy is actually made and served, and can be extended another 60 days in writing. A sheriff’s levy of a bank account ends after 90 days unless extended by court order. In practice, New York’s 90-day levy rule usually means something simpler but a lot more final: Get legal help and organize a defense before the money ever goes. Also, getting a levy discharged after turnover does not get the money back.

How the Funder Got Its Judgment

Your options depend on how the funder got its judgment. Any confession of judgment in the signed agreement lets the funder get a judgment with no lawsuit or notice to you. Since 2019 New York allows filing a confession of judgment only in the county where the business said that it is located or has a place of business. If the agreement included an affidavit, that affidavit can’t be filed more than three years after signing. Confession of judgment could be much restricted under legislation already passed by one house of the state legislature. A bill approved by the state Senate May 13, 2026, would ban confessions of judgment on debt principal of less than $5 million. The bill has not yet passed the Assembly or been signed by the governor.

A traditional lawsuit can be ended by default judgment if the defendant never answered, or with a judgment on the merits if the court actually looked at the case. A third option for the funder is to ask for arbitration, then if it wins that, to ask a court to confirm the award. In June 2026 New York’s Attorney General sued Rapid Ruling, alleging that in 97% of roughly 3,000 of its arbitration cases, no small business appeared to contest the decision. In New York, a motion to vacate an arbitration award must usually be filed within 90 days of its delivery.

Check first whose account is involved. If the bank holds the account of an ordinary natural person, the bank cannot send those funds to the sheriff for at least 27 days. That person then gets 20 days from the date the bank mailed a notice to reclaim their exempt funds. And if your bank is holding cash funds of a business, these exemptions don’t apply, so its money has no shield. Remember what this levy costs, and who is vulnerable. In New York City counties the sheriff takes 5% as fee, called poundage, on all money collected. Also, nearly every MCA asks for a personal guaranty from you as the owner. So your personal accounts are reachable too, and your property may be exposed as well.

Then check whether the judgment can itself be undone. If the judgment was entered against you because you never answered, a motion can be made to vacate the judgment for “excusable default” within one year after service of the judgment and notice of entry. If the judgment was entered because of fraud or lack of jurisdiction, there is no statutory deadline at all. For a judgment based on a confession, look into whether it was in the right county, on a signed affidavit, and an enforceable amount. These can be procedural defects of the sort that can bring fastest relief.

Things Not to Do

• Don’t move accounts or create a new company; these all invite charges of fraudulent transfer and personal liability.
• Don’t tell the bank your authorized debits were unauthorized; that backfires and carries risk of liability.
• Don’t sign new advances, amendments or settlement offers without a review.
• Don’t file online form letters; they won’t do a thing.
• Be very careful with ACH. Closing or switching accounts on your own may be seen as breach and trigger personal guaranty enforcement.

Ways Out

Finally, look at ways out of this problem. Many merchant cash advance disputes resolve through negotiated workouts, getting a reduced payoff, different terms, a release of lien claims. Bankruptcy filing generally triggers an automatic stay halting most collection, but a business filing does not resolve the owner’s personal guaranty. Bankruptcy is a big decision and needs expert help.

The other big decision is picking the lawyer. Ask how many of these cases they have handled lately, whether they have worked on confessions of judgment, and how fast they can jump on a restraint or levy.

Bottom line, the clock is already running. So gather your critical items now. Start with your executed MCA agreement and any amendments, all bank statements for the last ninety days and every letter from the funder, its broker or lawyers. Gather too all your emails, texts or voicemails that could bear on the matter. Then get them reviewed before any deadline passes.