The objective of this post is to tell you, the business owner who just missed an MCA payment (or is about to), exactly what your options are. Most of what’s online about this is wrong, or written by people who’ve never actually negotiated with an MCA funder.
Short answer: Sometimes yes, sometimes no. If you call the funder within 24-48 hours, didn’t block the ACH, and you’re with one of the more institutional funders, you can usually catch up by wiring the missed amount and resuming the daily debit. If you blocked the ACH, missed multiple payments, or you’re with one of the more aggressive funders, “catching up” is off the table — what’s on the table is a modification, a settlement, or a lawsuit. The window is small. It closes fast. And the wrong move in the first 24 hours can turn a missed payment into a confession of judgment filed against you a week later.
If you’re behind, read this before you do anything.
What does “catching up” actually mean?
This matters, because the funder hears something different than what you’re saying. There’s three different things a business owner means when they say “catch up”:
- Curing the default — paying the missed amount, resuming normal payments, going back to where you were
- Modifying the deal — negotiating a lower daily, a longer term, a temporary pause
- Settling for less than owed — paying a lump sum that’s less than the balance, in exchange for the funder closing the file
Three completely different conversations. Three completely different outcomes. Most business owners call thinking they’re having conversation #1, and the funder steers them into conversation #2 — on terms that almost always benefit the funder, not you.
Will the funder actually let you catch up?
Depends entirely on the funder. Here’s roughly how it shakes out, based on what we see across hundreds of files.
- Tier 1 funders (larger, more institutional ones) — usually willing to let you catch up, if you call within a day or two, fund the missed payments, and have a real reason. They want the deal to perform. They don’t want to litigate if they don’t have to
- Mid-tier funders — mixed. Some will work with you. Some will use the missed payment as a pretext to renegotiate at a higher rate, or to add a confession of judgment if they don’t already have one
- Bottom-tier funders (the unsavory ones) — many of these want you to default. The litigation playbook is more profitable for them than the deal performing. A missed payment is the trigger they’ve been waiting for
You probably know which tier your funder is in. If you don’t, look at how they communicated when they funded you, who the ISO was, and what the contract looks like. The contract tells you almost everything.
What to do in the first 24 hours after a missed payment
Speed matters more than anything else here. Here’s the order of operations.
- Don’t block the ACH. This is the single biggest mistake business owners make. Blocking the ACH turns a missed payment into an affirmative act of default, and hands the funder grounds to accelerate the full balance. If the money’s not there, that’s one thing. If you actively block it, you’ve handed them the case
- Call the funder before they call you. Funders treat inbound calls completely differently than outbound. If you call them, you’re a business owner trying to make it right. If they call you, you’re a collections file
- Have a real reason. “Slow week” doesn’t work. “My biggest customer is paying Thursday, here’s the invoice” works. Specifics matter, vague answers don’t
- Don’t agree to anything on the first call. They’ll try to get you to agree to a modification, a higher daily, or a confession of judgment, on the spot. Don’t. Tell them you need to look at your numbers and call back tomorrow
- Document everything. Every call, every name, every promise. If they accelerate later and claim they never offered a catch-up, your notes are what protect you
Can you catch up if you’ve already missed multiple payments?
Harder. Once you’re 3-5 payments behind, most funders consider the deal in default, whether they’ve formally declared it or not. At that point, “catching up” usually isn’t on the table — what’s on the table is a modification, or a settlement.
And this is where it gets dangerous. Funders will offer you a “catch-up” that looks like a lifeline, and is actually a trap. The common ones:
- They add the missed payments to the back of the deal and extend the term — but bump the daily payment, so you’re now paying more per day, on a longer term, with the original balance plus default fees rolled in
- They require a confession of judgment as a condition of the modification. If you miss again, they get a judgment against you in 24 hours, no court appearance, no defense, nothing
- They require a personal guarantee that wasn’t in the original deal
- They cross-collateralize with another deal, or with another entity you own
Read every word of any modification document before you sign. Better yet — have someone who reads MCA contracts for a living read it before you sign. The cost of a 30 minute review is nothing compared to the cost of signing a confession of judgment you didn’t understand.
What if the funder won’t let you catch up?
Then you’re in different territory. You’re now choosing between three paths.
- Settle the deal — negotiate a lump sum payoff for less than the balance. Most funders will take 50-70% of the balance, if you can fund it within a short window
- Restructure across all your debt — if you have multiple MCAs (and most business owners in this position do), trying to settle one at a time doesn’t work. The math only works if you restructure everything at once
- Litigate — if the funder has already accelerated, filed suit, or filed a confession of judgment, you may need to fight it. There are real defenses to MCA enforcement, especially if the deal is a disguised loan, if there are usury issues, or if the funder violated New York’s recent COJ restrictions
None of these are good options. They’re the options that exist once catching up is off the table.
The bottom line
Yes, you can usually catch up on a missed MCA payment — if you act within 24-48 hours, if you didn’t block the ACH, and if your funder is the kind that wants the deal to perform. Outside of those conditions, “catching up” turns into a renegotiation, and the renegotiation almost always favors the funder.
