Took out a MCA loan with SOS Capital and now I’m crashing FAST 🛩

by maistrofresh. Posted on Sep 12, 2020    1    6

Hoping to find some advice, support, ideas? So I’m a sole proprietor LLC in the Renewable Energy (solar) sales/marketing sector. Based in SoCal where business is and should be booming. The problem is I took focus on building a “nationwide” sales platform at the wrong time and without financial backing. I’m highly motivated and really good at what I do, just poor decision maker sometimes. Naturally, I thought I could grow something amazing with an awesome team behind me. So $45k should zap in exactly what we need to thrive. This was around February (pre-Covid). Fast forward 5 months, Lost employees, lost a lot money trying to hold on by cutting overhead expenses enough to still make a living and keep some folks working. I didn’t think much of SOS capital loan that I needed to repay. I figured they had a lot on their hands with COVID and that they weren’t worried about a small company like mine. I was trying to work something out with them but before we could settle on something I’d already received a Summons in New York. They hired a law firm who quickly filed law suit and sent UCC lien letters to my Vendors to freeze account receivables. This is the first step into a world of embarrassment and financial stress. I work with several contractors who’s earnings are tied up. I’m beginning to feel like the light at the end of the tunnel is disappearing FAST! I’m usually pretty resourceful and can fix a situation like this but I’ve screwed myself and those who work with me. Now with this lawsuit. I’m getting letters from debt consolidation, lawyers, debt consultants... My head is spinning! I don’t know which way to go. I’m not one to give up especially since I’ve put so much money, time and effort into my company. I’m not ready to let it die for such a minuscule amount but I’m getting crushed and moral is at the ground level. Wife is 7 months pregnant and we just got a 30 day notice to vacate our home. Landlord won’t extend our lease for no apparent reason, we’ve never been late. I need time not money right now. Maybe both, I don’t know!! Can someone please share some thoughts or advice? I sure could use some support. Thank you!


johnsoncn 2

Had a friend go though almost the same problem - over-extended the business and couldn't see any hope. He then killed himself.

  1. Share your predicament with your family - they may be able to help. But you'll also find out that there's not as much shame as you think there's would be.
  2. Understand the this is a temporary problem. You'll be able to look back on this in five years and say "Well... that was a weird adventure"
  3. Cut you expenses immediately to preserve money to pay a good bankruptcy attorney.
  4. Consider prepaying your attorney - your money may disappear.
  5. Cut your living expenses to nothing (verify this with your attorney.)
  6. Leave the rest to your attorney. They'll know what to do.
  maistrofresh 2

Thank you! I’m terribly sorry to hear about your friend. I’m not sure this business is worth that much trouble but definitely does cause some discerning pain to be in the situation. These are good points and I will certainly consider them. Thanks again

not-on-a-boat 2

There were some changes to business bankruptcy law that came into effect this year that makes it easier to negotiate with creditors. You might want to explore that as a negotiation position.

  maistrofresh 1

I’d appreciate some more information. Thank you for that. I’ll see what I can dig up about that?

Fine-Trouble269 3

I have been in your shoes. I was overwhelmed with MCAs then got a reverse consolidation with PAR Funding, and went from bad to worse. The daily draws had my accounts in the negative. I was scared to default, but after speaking to several people ended up using Michael at Dramer Law. I have one account left to settle , out of five, and PAR Funding has problems with the SEC so nothing is happening there. The laws vary by state on the MCAs, so you need someone with knowledge.

  maistrofresh 1

Yes thank you. I’m talking to a lawyer in New York but So far I haven’t really heard anything worth pursuing with them other than it almost seems like something I can negotiate on my own. Which I’m very scared to do.