This seems to be a new confusing financial product offered by the MCA industry.
The touted idea is to “consolidate” your MCA’s and pay off earlier MCA’s by only dripping the new money into the same business checking account at the same rate others are taking it out. That’s not a solution, it’s a band-aid [and really just another MCA]. The business checking account of a stacked small business is getting drafted multiple times a day already.
Here is a scenario you’ll find hard to believe. Let’s say you have $100,000 out in mca’s and are having trouble paying them. And let’s further say you’ve paid them down to $86,000. Someone suggests you take a reverse consolidation for $100,000 to pay the others off and get cash in your hands.
Here is what happens – yes, in most instances, you’ll get $14,000 in cash and the “reverse consolidation” company will inject cash into your account at the same rate it was going out to the other MCA’s but you now have another contract signed by you for $100,000, even though they didn’t give it to you in a lump sum and now you still have the other MCA contracts [ totaling $100,000 ] for a complete total of now, $200,000 in MCA’s.
So, for $14,000 in cash, you signed another contract for $100,000. Plus, you are paying [high] interest on the first batch, and now, the second batch too!
If you are stacked with multiple MCA’s, there is only one proven solution: Good faith negotiating, on a budget, by a super experienced team that specializes in this exact type of negotiation.
Please read this page.
Call us, the consultation is free. Phone: 855-708-2672