Austin, TX Merchant Cash Advance Lawsuit Defense Lawyer

Austin MCA Defense Attorney for Texas Business Owners

Protecting Central Texas Businesses from Predatory Merchant Cash Advance Companies

If your business in Austin or Central Texas took out a Merchant Cash Advance (MCA) to manage cash flow, you may now be facing the stressful reality of aggressive collection tactics—or even a lawsuit. You’re not alone, and this is not a situation you have to face by yourself.

My name is Tyler Hickle, and I am an Austin-based attorney dedicated to defending Texas businesses from predatory MCA funders. I understand the deceptive nature of these agreements and the aggressive, often unlawful tactics MCA companies use to collect. They are counting on you to be intimidated. I am here to fight back.

Don’t let a New York or Florida-based MCA company dictate the future of your Texas business. Contact me today for a confidential consultation. When you call my office, you speak directly with me, and your case receives my full personal attention from start to finish.

What Is a Merchant Cash Advance—and Why Is It So Dangerous?

At first glance, a Merchant Cash Advance seems like a convenient alternative to a traditional loan. The pitch is enticing: no extensive paperwork, no collateral, and fast funding. But here’s what’s really happening:

How MCAs Work:

• The “Purchase Price”: You receive a lump sum of cash from the MCA company.
• The “Receivables Purchased”: You agree to repay a much larger amount.
• The “Factor Rate”: This is how your repayment is calculated. A 1.4 factor rate on a $50,000 advance means you owe $70,000—not based on an interest rate.
• Repayment Method: Fixed daily or weekly withdrawals are taken from your business account via ACH (automated clearing house) debit.

These payments do not adjust for your revenue. Whether your business makes $10,000 or $100 in a day, they still withdraw the same amount, often forcing businesses into a second or third MCA to cover the first—this is known as the MCA debt spiral.

Is Your MCA a True Sale or a Disguised Loan?

This is the most important legal question in nearly every MCA lawsuit in Texas. MCA companies label their product a “sale of future receivables” to dodge state usury laws. However, if the arrangement operates like a loan, the company may be in violation of Texas law.

Key Legal Points:

• Texas caps the interest lenders can charge.
• Many MCAs have an effective APR of 100%, 200%, or more—far above the legal limit.
• If deemed a loan, the contract may be unenforceable due to usury violations.

I will analyze your MCA agreement for signs it’s actually a disguised loan, including whether there’s a personal guarantee or if the payment schedule is fixed like a loan.

Common MCA Companies Suing Texas Businesses

I routinely deal with the most aggressive MCA funders targeting Texas small businesses, including:

• Yellowstone Capital (and affiliates like Fundry and Delta Bridge)
• OnDeck Capital
• CAN Capital
• Fora Financial
• Kapitus
• Rapid Finance

These companies are not traditional lenders. They operate nationwide and have systems designed to rapidly sue and collect from businesses. I understand their tactics—and how to fight back.

New Legal Protections Under Texas House Bill 700

Beginning September 1, 2025, Texas House Bill 700 will create strong protections for small businesses dealing with MCAs.

Key Provisions of HB 700:

• Mandatory Disclosures: MCA providers must disclose total financing amount, finance charges, total repayment, and payment schedule before signing.
• Restrictions on ACH Withdrawals: Funders cannot automatically debit your account unless they hold a valid, first-priority security interest—which most don’t.
• Ban on Confessions of Judgment: These clauses will be void and unenforceable in Texas.

If your MCA contract doesn’t comply with HB 700, it may be illegal. I will use this new law as a tool in your defense.

Are MCA Penalties Actually Illegal?

Many MCA agreements include outrageous default penalties disguised as “liquidated damages.” Under Texas law, liquidated damages must be a reasonable estimate of real harm—not a punishment.

If the MCA company adds fees that aren’t tied to actual damages (e.g., automatic $10,000 default charges), those clauses may be void. Challenging them can drastically reduce what you owe.

MCA Collection Tactics I Fight Against

MCA funders often use intimidating and legally questionable tactics. I defend clients against:

• Improper UCC Liens: MCA companies file UCC-1 liens to tie up your assets. I challenge their legality and scope.
• Unlawful ACH Debits: Many automatic withdrawals will become illegal under HB 700. I take action to stop them.
• Frozen Bank Accounts: With a judgment, MCA attorneys can freeze your accounts. I move quickly to challenge the judgment and restore your access.

Why the FDCPA Doesn’t Protect You

Many business owners mistakenly believe the Fair Debt Collection Practices Act (FDCPA) applies to MCA harassment. Unfortunately, it doesn’t. The FDCPA only applies to personal debts—not commercial ones like MCAs.

But that doesn’t mean you have no protection. Instead of relying on FDCPA, I use stronger arguments based on:

• Usury law violations
• Breach of contract
• Texas commercial finance laws (like HB 700)

My Legal Strategy to Defend Your Business

When you hire me, you’re getting more than legal representation—you’re getting a partner in your business’s defense.

My Defense Approach:

1. Initial Case Review: I examine your MCA agreement, financial status, and funder communications.
2. Challenging the Lawsuit: I file a formal Answer and assert affirmative defenses under Texas and federal law.
3. Aggressive Discovery: I use legal discovery to demand proof, exposing MCA company practices.
4. Negotiating Settlements: I apply pressure to get favorable settlements—most MCA funders don’t want a court battle.
5. Trial Representation: If necessary, I’m ready to take your case to trial and defend your rights in court.

Why Choose a Local Austin MCA Defense Attorney?

The MCA industry may be national, but your business is local. Choosing an Austin-based attorney gives you a home-field advantage.

I understand the Central Texas court system, the local business climate, and the new Texas laws better than out-of-state firms. I live in this community and am committed to defending Texas entrepreneurs.

Take the First Step Toward Financial Relief

Ignoring an MCA lawsuit or default is the worst thing you can do. With House Bill 700 taking effect, your legal defenses are stronger than ever.

You worked hard to build your business. Let’s protect it together.

Contact Tyler Hickle today at 512-289-3831 or fill out the online contact form for a confidential, no-obligation consultation. Let me help you reclaim your business’s future.