Criminal Defense Lawyers

Arkansas Merchant Cash Advance Attorney

Arkansas Merchant Cash Advance Attorney

Merchant cash advances have become an increasingly popular form of alternative business financing in Arkansas over the past decade. Unlike traditional bank loans, merchant cash advances provide businesses with quick access to capital based on a percentage of their future credit card and debit card sales. While merchant cash advances can provide much-needed working capital, some Arkansas business owners have found themselves struggling to keep up with the high repayment rates. In some cases, predatory lending practices by merchant cash advance companies have led Arkansas businesses into financial ruin.If you are an Arkansas business owner who has concerns about your merchant cash advance agreement, contacting an experienced Arkansas merchant cash advance attorney can help you understand your rights under state laws and explore your legal options. This article provides an overview of how merchant cash advances work, common legal issues that arise, and defenses an Arkansas merchant cash advance lawyer may be able to assert on your behalf.

How Do Merchant Cash Advances Work in Arkansas?

A merchant cash advance is a form of alternative small business financing in which a lender purchases a portion of a business’s future credit card receivables at a discount. For example, a merchant cash advance company may provide an Arkansas business with $100,000 in capital in exchange for 15% of the business’s credit card sales until $150,000 is repaid.The merchant cash advance company then collects the agreed-upon percentage of the Arkansas business’s daily credit card receipts via automatic withdrawals from the business’s merchant account. Repayment terms are usually between 4-12 months.Unlike a term loan, there is no fixed repayment schedule with a merchant cash advance in Arkansas. The business simply repays the advance when credit card sales come in. This flexibility can be beneficial for Arkansas businesses with irregular cash flow. However, it also means the total repayment amount can vary widely depending on the business’s sales volume. Arkansas businesses can end up paying back far more than they anticipated if sales are low.

Common Legal Issues with Arkansas Merchant Cash Advances

While merchant cash advances provide easy access to capital for Arkansas businesses, they also come with some significant legal risks that business owners should be aware of. Some common legal issues and disputes that arise include:

• Excessively high interest rates – Some merchant cash advance companies charge annualized interest rates over 100% or more, which may be illegal under Arkansas usury laws.
• Deceptive marketing practices – Merchant cash advance companies may misrepresent or fail to adequately disclose repayment terms, total costs, eligibility requirements, or other key information.
• Breach of contract – Disputes over whether the merchant cash advance company is adhering to the agreed-upon terms, such as only withdrawing certain percentages of receivables.
• Confessions of judgement – Arkansas business owners may be pressured into signing confessions of judgement that allow the lender to seize funds or assets without notice.
• Aggressive collections – Merchant cash advance companies may engage in harassment, threats, or other unlawful tactics to collect payments.

These issues have prompted calls for greater oversight and regulation of merchant cash advances in Arkansas. However, currently there are limited protections under state law.

Merchant Cash Advance Defenses in Arkansas

If you are facing legal action from a merchant cash advance company, contacting an experienced Arkansas merchant cash advance attorney can help you understand and assert possible defenses. Here are some potential legal and equitable defenses Arkansas lawyers may be able to raise:

• Unconscionability – Argue that the agreement is so unfair, one-sided or abusive that it should not be enforceable under Arkansas law.
• Usury – Claim that the interest rate or fees exceed the maximums allowed under Arkansas usury statutes.
• Deceptive trade practices – Allege that the company engaged in deception, false statements, or omissions about key terms.
• Duress – Argue you were under unfair pressure or coercion when signing the merchant cash advance agreement.
• Breach of contract – Claim the company did not fulfill its contractual obligations.
• Unjust enrichment – Argue that repayment would unfairly enrich the merchant cash advance company.

An experienced Arkansas merchant cash advance lawyer can assess the specific facts of your case and determine which defenses may apply. They can also try to negotiate a settlement or payment plan if needed.

Finding the Right Arkansas Merchant Cash Advance Attorney

If you need legal help challenging a merchant cash advance agreement in Arkansas, it is important to find an attorney experienced in commercial litigation and financial services law. Be sure to ask about their specific experience with merchant cash advance cases. It may also help to find an Arkansas attorney located near you who is familiar with the local courts and legal environment.Here are some tips for finding a qualified Arkansas merchant cash advance attorney:

• Search state and local bar association directories for commercial and business litigation attorneys.
• Look for lawyer directories and reviews online to research attorneys’ backgrounds and experience.
• Ask other local Arkansas business owners for referrals.
• Contact consumer advocacy groups for recommendations.
• Schedule consultations with a few attorneys to discuss your case specifics.
• Consider attorneys who offer free initial consultations and flexible fee arrangements.
• Check whether the attorney is licensed and in good standing with the Arkansas Bar Association.
• Choose an attorney you feel comfortable with and who understands your objectives.

Having experienced legal counsel can help Arkansas business owners maximize their chances of reaching a favorable resolution when disputes arise over a merchant cash advance agreement. Don’t hesitate to contact a qualified Arkansas merchant cash advance attorney for assistance.