The first forty-eight hours after service of an MCA lawsuit are not the time for deliberation. They are the time for triage, because the funder has already been deliberating for weeks.
Five actions in the first two days create the conditions for a viable defense. Each one closes a door the funder is counting on you to leave open.
Identify the Exact Date of Service
The response deadline runs from the date service was accomplished, not the date you became aware of it. New York’s CPLR gives you twenty days if you were served personally, thirty if service was effected by another method such as nail-and-mail or service on a registered agent. A process server’s affidavit of service will state the date and method. Locate that document and write the deadline on paper before doing anything else.
Courts grant extensions, but they are not automatic. A deadline missed by one day without a prior motion produces a default. And a default judgment in an MCA case means immediate account restraint authority, not a courtesy notice.
Move Money With Caution, Not Panic
The fear response after receiving a lawsuit is to transfer funds out of exposed accounts. That instinct deserves scrutiny. If a judgment has already been entered through a confession of judgment you were not aware of, transfers made after service of process can be characterized as fraudulent conveyances, creating liability beyond the original MCA balance. If no judgment exists yet, the account is not legally restrained and normal business operations may continue.
The distinction matters enormously. An attorney needs to see the papers before you move anything substantial, because the posture of the case determines what is prudent and what is problematic.
Do Not Sign Anything the Funder Sends
Within hours of a lawsuit filing, some funders send forbearance agreements, payment deferral proposals, or settlement term sheets. These documents are drafted by the funder’s counsel. They almost always include a release of all claims and defenses, a new personal guarantee, and an acknowledgment that the debt is valid. Signing one eliminates every argument that the courts have developed in defendants’ favor over the last three years.
A forbearance agreement that saves you thirty days of payments and costs you every legal defense is not a forbearance. It is a capitulation with a delay clause.
Locate and Organize Your MCA Documents
The original agreement, the disclosure form if one was provided, your application materials, and every bank statement covering the period of MCA payments are the documents your attorney will need in the first meeting. The reconciliation provision, if your contract contains one, is the clause that describes how daily debits adjust when your actual sales volume changes. Whether that clause is genuine or cosmetic is the central question in most MCA recharacterization cases.
If you cannot locate the agreement, your bank’s transaction history will show the debit pattern. Fixed daily amounts regardless of revenue fluctuation is the factual record that supports a usury argument even before the contract is obtained through discovery.
Contact an MCA Defense Attorney
Not a general business attorney. Not a bankruptcy attorney evaluating whether filing provides relief. An attorney who has read MCA contracts and litigated MCA cases in New York courts, where most of these actions are filed regardless of where your business operates.
The forty-eight hour window is real. An emergency order to show cause, if the circumstances warrant one, requires immediate preparation. A motion to vacate a confession of judgment has procedural requirements that take time to satisfy. Retaining counsel in the first two days does not guarantee a particular outcome, but it preserves the range of outcomes that remain available.
Consultation is where this conversation begins. The clock started when the papers were served.
