Santa Ana, CA, April 14, 2020 --(PR.com
)-- Small business owners have been hit by a tsunami of uncontrollable forces putting their very existence at risk. It seemed that the economy was rolling along just a few weeks ago before the pandemic hit - but the truth is many small business owners already had a very thin margin of error to work with. Lack of reserves, seasonal business, extreme weather, unpredictable tariffs and shutdowns were all issues and then along came the ultimate game changer, coronavirus.
Many of these business owners were facing layoffs, breaks in their supply chains, huge reduction in revenue and in some cases struggling to keep their doors open. Because traditional financing for small business owners is difficult to obtain, many of these struggling merchants have taken out Merchant Cash Advance Loans (called MCA) to help with cash flow shortfalls in the past. These transactions are structured as a purchase of future receivables in order to avoid the laws and regulations surrounding traditional lending.
This had been easy to obtain financing, but it comes at a high risk, with astronomical interest rates and a very high pay back (sometimes up to 150% or 200%). Most of these types of loans have daily ACH withdrawals as part of the contracted payback (some are weekly). This means that every day the small business owner’s account is being drafted by the lender, regardless of business volume, extreme weather, off season, etc. Add to this the overwhelming damage inflicted by COVID-19 on small business owners, affecting their revenues, payroll, employees and in many cases threatening the viability of the business.
In this crisis, the government has put into place protections for many consumers, tenants, landlords, small business owners, etc. that allow them to postpone payments on mortgages, credit cards and government loans with no penalty. Unfortunately, due to the structure of the Merchant Cash Advance financial product, this transaction is not regulated and is not covered by any of the protections put in place to help small business during this crisis. The government has offered SBA loan programs, but due to the volume of applications it will take weeks, if not months, for them to be processed and funded. It seems there are no fast or easy options available for business owners who are overwhelmed with debt other than Chapter 11 or Chapter 13 bankruptcy.
National Credit Partners can help! In these unprecedented times, National Credit Partners can step in and provide a lifeline for small business owners by restructuring and modifying their business debt. National Credit Partners can reduce loan payments 50% to 70% by utilizing their expertise, leverage and relationships with the lending community. They negotiate for 100% payback of the contracted amount to the lender, so merchants can protect their credit and be eligible for financing in the future while providing legal counsel to help them navigate the process.
Some MCA lenders are granting struggling business owners a voluntary and arbitrary temporary reduction or forbearance, but in the unregulated world of the MCA this means the merchant has broken their contract. The lender has full authority to raise the payment at their discretion regardless of ability to pay - full authority to add in thousands and tens of thousands in fees and interest - full authority to utilize all collection methods for a merchant who can’t pay or stops ACH including liens, COJ and lawsuits. These merchants need help, they need legal representation and a way to keep their cash flow where it needs to be while holding off the aggressive lenders and meeting their debt service.
National Credit Partners provides representation to negotiate a new permanent contract and the best possible deal as opposed to a temporary reduction by a company in an industry with no rules or regulation. National Credit Partners walks in this world every day and know the players involved - and these companies and agencies and law firms know National Credit Partners as well and know that they are negotiating for relief with 100% payback and are willing to negotiate in a fair and transparent manner.
The wise small business owner needs help, protection and legal counsel. The ethical business owner wants to pay back what they truly owe (100%) to the lender. And the practical business owner knows that they can’t continue down this path with these out of control payments and a lender who holds all the cards. That is why small business owners in this situation need to call National Credit Partners today at 888-766-3998. A+ Rating with the Better Business Bureau and an accredited member of AFCC.
For more information call 888-766-3998