End-to-end debt resolution for operating businesses
When you owe money on multiple fronts, MCAs, term loans, vendors, tax, we run a single coordinated workout. One team, one plan, one phone line. Your business keeps running while we negotiate.
ALL
creditor classes
1
point of contact
30D
typical stabilization
$5M+
engagements handled
THE PROBLEM
Most owners try to handle it alone
COORDINATED WORKOUT
$1.2M → $410K
66% reduction · stacked debt portfolio
That approach destroys cash and resolves nothing.
A typical distressed business has 5–8 creditors of different types, each with its own contract, its own collection cadence, its own leverage. Owners try to triage by who is yelling loudest.
That approach destroys cash and resolves nothing. The right approach is a single audit of every obligation, a creditor-by-creditor leverage map, and a sequence of moves designed to land all of it.
Business Debt Resolution is the flagship service: we own every creditor relationship until the engagement is closed.
Triage by the loudest vs. coordinated sweep
Same five creditors. Same owner. Two completely different outcomes depending on whether each call is handled in isolation or as part of a sequenced portfolio.
WHAT WE HANDLE
6 scenarios, opened up
01Scenario 01Multi-creditor workouts+
Coordinate negotiations across MCAs, term loans, lines of credit, vendor debt, and tax obligations in one plan.
How we run it
01Pull every contract, balance, status
02Rank creditors by leverage and urgency
03Open negotiations in priority sequence
04Close out with signed releases
Typical outcome
Avg outcome: portfolio settled at 35–55% of stacked balance · 9–14 months
02Scenario 02Cash-flow stabilization+
Stop the bleeding fast: pause ACHs, reschedule the most aggressive creditors, reset the operating runway.
Avg outcome: judgment vacated or settled pre-trial in 4–8 months
04Scenario 04UCC lien remediation+
Negotiate releases on filings choking your AR, payment processors, and banking relationships.
How we run it
01Audit every UCC-1 on the business
02Identify expired or improperly perfected filings
03Negotiate releases or terminations
04Restore processor / banking access
Typical outcome
Avg outcome: 60–90% of liens released or subordinated
05Scenario 05Restructure-and-keep+
When the business is fundamentally healthy, restructure to a sustainable monthly outflow without bankruptcy.
How we run it
01Document hardship and pro-forma cash flow
02Build creditor-by-creditor concession ask
03Submit modification packages in parallel
04Sign restructure agreements
Typical outcome
Avg outcome: monthly debt service cut 40–60%, business retained
06Scenario 06Wind-down strategy+
When closure is the answer, structure the orderly exit so personal guarantees don't follow you.
How we run it
01Inventory assets and PG exposure
02Coordinate vendor + lender close-outs
03Structure asset sale or assignment
04Release PGs as part of close
Typical outcome
Avg outcome: orderly exit with PGs released or capped
“
FROM THE DESK
Most distressed businesses don't fail because the debt is too large, they fail because they negotiate one creditor at a time and lose the leverage that comes from running the whole portfolio in sequence.
Service agreement on file. We open communication with creditors on your behalf, work to pause aggressive collection actions, and help protect your bank accounts.
Service agreement · Docket monitoring · Bank protection
03
Step 3
Negotiation
Our team handles every creditor communication. We document everything; you stop fielding calls.
Settlement memos · Counter-offers · Discovery if litigated
04
Step 4
Resolution
Signed settlement agreements, lien releases where applicable, and a clean path forward for the rebuild.
Final agreements · Lien releases · Closeout package
★★★★★
“Delancey Street walked us through every step. The settlement saved the business, and our credit.”
Business Debt Resolution: the owner's field guide to getting out
There is a particular fear that we've seen time, and time again, that hits a business owner in the morning, when their daily ACH hits and the business bank account can't cover it. The accountant, or bookkeeper, sees it first. Then the owner. Then, usually within forty-eight hours, the funder. By the end of the week, three more funders have tried pulling their ACH and it failed, the bank has flagged the account for excessive returns, and the phone is ringing in a way it wasn't ringing the week before. Every lender is worried about their money, and increasingly making threats, and you're sitting there wondering: now what?
This is the moment most owners type "business debt resolution" into Google to figure out what Plan B looks like.
If that's you, read the rest of this article very carefully. We have written this article in order to make it as informative and helpful as possible. The goal is to get you to a better place, even if you're not working with Delancey Street. The decisions you make in the next few days will determine whether this becomes a six-month workout or a three-year unwinding that drags personal guarantees, vendor relationships, and your credit through the mud.
There is a credible way out. But it's not easy, and it requires a lot of effort, and collaboration.
In a workout right now? A Delancey Street senior advisor will map your stack, identify the leverage, and call back in 30 minutes. Free, confidential, no commitment.
What "business debt resolution" actually means in practice
Business debt resolution is a term for any process which takes your business from being over-leveraged and behind on payments to current, current-on-modified-terms, or settled. It is not one product. It is an outcome, designed to get your business into a better place. It is a categorical term, and the term contains several distinct strategies that business owners routinely confuse with one another:
Debt settlement: negotiating a lump-sum or term payoff for less than the full balance owed.
Debt restructuring: modifying the terms without necessarily reducing the principal.
Reconciliation: for merchant cash advances specifically, using the contractual right to adjust daily debits based on your actual revenue.
Workout / forbearance: a temporary pause or reduced-payment period, usually with an SBA or bank lender.
Litigation defense: challenging the enforceability of the debt itself, including Confessions of Judgment (NY S6395), usury claims, and breach of contract.
Bankruptcy:Subchapter V (small-business reorganization), Chapter 11, Chapter 7, depending on entity and circumstance. The last resort, and frequently the wrong tool.
Most business owners who are struggling to keep up need some combination of two or three of these. The job of a business debt relief company is figuring out which combination, in which sequence, against which creditors, and with what leverage. That coordination is what Delancey Street does for a living.
The type of debt we usually see: merchant cash advances
If you took a merchant cash advance, or you took two, or you took five (what the industry calls a "stack"), it eventually catches you and nails you to the wall. It catches everyone. This is not debt any business can afford. It is an emergency lifeline, but it ends up taking your life. Factor rates of 1.35 to 1.55 on six-to-twelve-month terms work out to APRs that, if disclosed in TILA terms, would routinely exceed 100% and frequently exceed 200%. Stacking compounds the problem because each new advance services the prior one without adding any actual revenue to the business. These are not sources of funding any real business should be taking to grow their company.
The ACH debits hit daily, or hit weekly. Then an MCA position bounces. Then another funder sees the bounce on the bank statements you sent during underwriting and pulls a stop-pay or accelerates. Some lenders will even penalize you for stacking by invoking the stacking clause. Within thirty days of the first miss, an owner with three or four positions can be looking at COJs filed in New York County, UCC liens filed against receivables, and bank levies on operating accounts.
Resolution of MCA debt is not the same as resolution of a term loan or a line of credit. The contracts are different, and this is on purpose. The funders insist they are sales of future receivables, not loans, which has consequences in both directions.
The four-stage resolution process
What follows is the process Delancey Street has run more than a thousand times.
The four stages at a glance
A pipeline view of the work behind each stage, sequenced from intake through closeout. Each downstream stage depends on the deliverables of the one before it.
Stage 1 Triage and inventory
Before anyone calls a lender, the engagement has to be mapped. That means pulling every contract, every email, every payment record, every UCC filing, every bank statement going back at least ninety days. The goal is to see the full picture before the picture starts moving, because once funders sense a workout is in progress, things start moving fast. Many lenders are opposed to you working with a business debt relief company because it means they lose leverage.
This phase tells you:
Who is owed what, exactly, and on what contractual terms.
Which positions are first-position, second-position, third-position UCC.
Which contracts have COJs filed or available to file.
Which contracts have reconciliation provisions and what they say.
Which payments are still landing and which have already bounced.
Whether any creditor has accelerated, sued, or levied.
What the operating account can actually sustain on a daily and weekly basis.
This is not simple work. It is the most important work in the engagement. Skip it, or hire a company who doesn't do this, and you negotiate from the wrong number, give up leverage you didn't know you had, or settle a position that was never going to be enforceable in the first place.
Stage 2 Leverage analysis
Every contract has weak points. During this phase, the Delancey Street job is to find them.
Whether the contract has the indicia of a true sale of receivables or whether a court would recharacterize it as a loan (the LG Funding v. United Senior Properties three-factor test in New York; the parallel analyses developing in California, New Jersey, Florida).
Whether the COJ, if one exists, was properly executed, properly venued, and properly served, or whether it is vulnerable to vacatur on technical grounds.
Whether the funder has breached its own reconciliation obligations, sweeps obligations, or duty of good faith and fair dealing.
Whether the personal guarantee has carve-outs or fraud-trigger language that the funder will or won't be able to invoke.
We use this phase to really understand what the strategy will be.
Send Delancey Street your contracts. We'll mark them up clause-by-clause and tell you exactly which levers exist, free and confidential.
Funders are not negotiated with simultaneously because that would not be smart. They are negotiated with in a deliberate order, driven by who has filed what, who is closest to legal action, who holds the operating account leverage, and who is most likely to set the tone for the rest of the stack. Get the first settlement signed at a 50% reduction and the next three funders price your engagement differently than they would have on day one.
What gets agreed to in this stage:
Stop-pay and ACH halt.
A new payment cadence, weekly or bi-weekly instead of daily, often with a holiday period.
A reduced principal balance, paid as a lump sum from a settlement reserve or as a structured term.
A release of the personal guarantee, or a covenant not to sue on it.
A UCC lien release on closing.
A no-disparagement clause, sometimes a tail period during which the merchant agrees not to take new advances from the funder's network.
Settlement agreements are not boilerplate. They are the product. A poorly drafted settlement leaves the merchant exposed to clawback, double-collection, or surprise reinstatement when an ACH bounces six months later. Read every line. Have a lawyer read every line.
Stage 4 Closeout, lien releases, rebuild
The engagement is not over when the agreements are signed. The engagement is over when:
Every COJ has been satisfied or vacated, on the record, in the right county.
Every personal guarantee release is in the file.
Operating bank relationships are stable, with appropriate ACH controls in place to prevent unauthorized re-debit.
The Delancey Street standard
We don't close a file at handshake. We close it when the public record is clean and the operating account is protected. Anything less is a deal that comes back.
Beyond the playbook: the hidden mechanics of multi-creditor distress
Most articles online treat business debt resolution as a list of independent line items you negotiate one creditor at a time. That is not how multi-creditor distress actually plays out. When a business carries five, six, or eight positions across MCA, SBA, vendor, equipment, and tax, the lenders interact with each other in ways that determine whether your workout succeeds or not.
Most MCA lenders know each other. Many of them syndicate on deals together. When pools of capital are tied to your file, collection efforts get coordinated. And there is a whole second layer of collateral damage, processor relationships, bonding, franchise rights, licensure, payroll tax, that nobody warns you about until you trip on it.
01 Lender networks
Your lenders talk to each other, and not in the ways you think
When you have one MCA in default, you have a problem. When you have four, you have a multi-headed hydra of a problem. Here is what is actually happening in the back office that you do not see:
Industry intelligence networks. MCA funders subscribe to services that track defaulted accounts across funders. DataMerch is one example. Others have names like NSAC, Lendio's intelligence layer, and proprietary platforms maintained by the larger funders themselves. When you bounce on Funder A, Funder B sometimes knows about it within days, or hours. They are not necessarily looking at your file specifically, but they are scanning for patterns that match merchants they have exposure to. Some have alerts set on your file directly. Every lender is different. What is certain is that if you default, your other MCA lenders may learn shortly. If the dollar amount is big enough, it is likely other lenders will coordinate.
ISO and broker chatter. The ISOs (Independent Sales Organizations) who originate MCA deals talk to each other. They share intelligence about which merchants are distressed because that information determines who they can keep selling to and who they cannot. If you have stacked through multiple ISOs, those ISOs are aware. They use DataMerch to coordinate as well.
Bank-level intelligence. Your bank sees every ACH pull. When five different MCA originators are all attempting to debit the same account, your bank's risk team is taking notice. Some banks proactively close accounts in this situation. Others quietly start flagging the merchant for enhanced monitoring.
The "watch list" phenomenon. Large MCA funders maintain watch lists of merchants showing problematic signals. Once you are on one funder's watch list, your existing relationships with that funder change, they tighten daily debit windows, decline modification requests, refuse renewals. You will not know you are on it until you notice the behavior shift. The funder stops prizing your business and starts turning the screws.
The practical implication: by the time you are calling a settlement firm, many of your creditors already know you are in distress, and they are already pricing your file accordingly. That means they likely have proactive measures in place and a protocol that triggers after X failed daily ACH debits.
02 Processor risk
The processor relationship is the silent landmine
Almost nobody talks about this. If you process credit card payments through Square, Stripe, Clover, Toast, Heartland, or any other merchant processor, that relationship is connected to your debt situation.
Some MCA funders work with the major processors as authorized split-funding parties. When a merchant takes a "split funding" or "lockbox" MCA, the processor is contractually obligated to route a percentage of every card transaction directly to the funder before it ever hits your account. That obligation lives in the merchant agreement with the processor, not just the MCA contract.
When the merchant defaults on the MCA, several processor-side things can happen:
Account freeze. The processor freezes all incoming card settlements pending the outcome of the MCA dispute. Customer payments stack up in a holding account you can't touch. The lender will threaten the processor with legal claims, including tortious interference, if the processor doesn't play ball.
Reserve increase. The processor increases your rolling reserve, meaning they hold back a larger percentage of every transaction against potential chargebacks or merchant risk. A merchant operating on a 1% reserve might suddenly be on a 10% rolling 180-day reserve. This is not theoretical. We have seen it happen.
MATCH list placement. The processor reports the merchant to the MATCH list (Member Alert to Control High-Risk Merchants). Once you are on MATCH, no major processor will board you for at least five years. Your business effectively cannot accept credit cards from a major processor for the duration.
Account termination. The processor terminates the merchant agreement entirely. You scramble to find a new processor while your ACH deposits sit in limbo.
03 Fraudulent conveyance
The fraudulent conveyance trap that catches owners trying to "protect" their cash
Here is the move that catches business owners. When you see distress coming and you have meaningful cash in the business, your instinct is to move it somewhere, pay yourself a distribution, transfer money to a personal account, move funds to an affiliate, prepay a related entity, buy assets you can hold personally. The instinct is to extinguish money from the business bank account before creditors get to it. It feels smart. It is fraudulent conveyance, and it has real legal consequences.
Under the Uniform Voidable Transactions Act (adopted in some form in most states, formerly called the Uniform Fraudulent Transfer Act), transfers made by an insolvent borrower with intent to "hinder, delay, or defraud" creditors can be unwound by a court order. Creditors can claw back the transferred assets and, depending on the jurisdiction, can pursue the recipient personally, the owner's personal account, the affiliate, or whoever else received the transfer. Many people think you can simply take the funds and disperse them. That is not the engagement.
Specific patterns that trigger fraudulent conveyance scrutiny:
Owner distributions in the 90 days before default that exceed normal owner distributions.
Transfers to family members, affiliates, or related entities for no clear business purpose.
Prepayment of friendly creditors while other creditors are not being paid and the lender is in default.
Asset sales below fair market value.
The trap
Most owners do this thinking they are being prudent. They do not realize they may have just personally guaranteed every dollar they took.
Ready to map your stack? Book a 30-minute strategy call with a Delancey Street senior advisor. Realistic settlement range, no sales pitch.
How is this different from your individual service lines?
Each service line (MCA, SBA, Vendor, etc.) handles one creditor type. Business Debt Resolution is the umbrella engagement when you have problems across multiple types and need them solved together. Same senior-advisor team, broader scope. When legal action is required for any creditor type, we coordinate with independent counsel from our referral network.
Will I have to file bankruptcy?
In the vast majority of our engagements, no. The point of debt resolution is to avoid Chapter 7/11 by reaching out-of-court settlements. We work alongside bankruptcy counsel only when it's genuinely the better tool, and we tell you that early.
Can my business keep operating?
Yes. Continuity is a primary design constraint. Settlements are structured around realistic monthly cash flow, vendor relationships are preserved where possible, and processor/banking exposure is actively managed.
How long does a full resolution take?
Most cases stabilize in the first 30 days, with full creditor resolution between 6–24 months depending on portfolio size and creditor mix. We give you a realistic timeline at the strategy stage, not a sales pitch.
What does it cost?
Our fee is a percentage of your total enrolled debt, quoted in writing before any work begins. The first consultation is free, and all engagement terms are documented up front.
Talk to a strategist about your business debt resolution case
Free initial review. We'll look at your contracts, the creditor mix, and what's actually triggerable in the next 30 days. No commitment, no sales pitch, just a real read on your situation.
Direct line
212-210-1851
Picked up by an actual debt relief manager, no phone tree.
Email
info@delanceystreet.com
Replies within 4 business hours, 24/7 for COJ emergencies.
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