How long after MCA default before they sue

Short answer: Faster than you think. Most MCA funders file suit within 2 to 6 weeks of default. Some move in under 10 days. A few will wait 60-90 days. There’s no rule, no required waiting period, no notice requirement in most MCA agreements. The moment you default, the clock isn’t starting — it’s already run out.

If you’re reading this because you just missed a payment, or you’re about to, keep reading. The timeline matters.

What “sue” actually means in MCA world

When people ask how long before the MCA lender sues, they usually picture a normal lawsuit. A complaint, a summons, you get served, you have 30 days to answer, discovery, eventually a trial. That’s not what happens.

Here’s what actually happens. The MCA funder files in New York (almost always New York, usually Nassau, Erie, or Westchester county), and along with the complaint, they file a motion for a Confession of Judgment, or more commonly these days, a motion for attachment, or a TRO. You signed an affidavit of confession when you took the MCA (if it was pre-2019), or you signed an MCA agreement with a New York choice of law, and jurisdiction clause. Either way, they have a fast track you didn’t know existed.

The TRO is the one that ruins your week. A temporary restraining order, granted ex parte, which means without you being there, without you being notified, freezes your bank accounts within hours of the judge signing it. You find out when your card gets declined at lunch.

The actual timeline, from default to lawsuit

Here’s how it usually goes. Not every lender moves at the same speed, but the pattern is consistent.

Days 1-3: The ACH bounces. The funder redoes it, it bounces again. Their in-house collections team starts calling. The calls are not friendly.

Days 3-10: The aggressive phase. Calls to you, to the personal guarantor, to your business line, sometimes to customers and vendors on your bank statements. Emails threatening immediate legal action. Some lenders will tell you they’re filing tomorrow, to scare you into a settlement. Sometimes they are. Sometimes they’re bluffing.

Days 7-21: The UCC notices go out. Your credit card processor gets a letter. Your customers get letters. The funder is trying to intercept your receivables before they have to go to court at all. If this works, they may not sue — they’re just taking the money directly.

Days 14-45: This is when most lawsuits get filed. The funder’s attorney (and there are maybe 10 law firms in New York that do the bulk of this work — you’ll see the same names over and over) drafts the complaint, files it, and moves for a TRO or attachment at the same time.

Days 21-60: If you haven’t settled, and the UCC interception isn’t pulling enough, this is when the more patient funders finally move. A few will wait longer than this, but not many. Waiting costs them money.

Beyond 60 days: Rare. If a lender hasn’t sued by day 60, it usually means one of three things — they’re a smaller shop that moves slow, you’re in active settlement negotiations, or they’ve written off the file as uncollectable. Don’t assume the third one. It’s almost never the third one.

What makes them move faster

Some defaults get sued on immediately. Others get a few weeks of runway. Here’s what speeds it up:

• You stacked. Taking a second or third MCA is the single fastest way to get sued. Funders have software that monitors your bank statements, and if another funder shows up in the debits, they know. They move that week.
• You switched bank accounts, or changed processors. This is read as an intent to hide money. They file immediately.
• You stopped answering the phone. Silence gets treated as flight risk. Engagement, even hostile engagement, slows them down. Ghosting accelerates everything.
• The balance is large. A $40,000 balance might sit for a month. A $400,000 balance gets filed on within the week.
• The funder is one of the aggressive ones. You know who they are. If you don’t, your attorney does.

What slows them down

• You’re actively negotiating. Even a bad-faith negotiation buys you days. A real one buys you weeks.
• You have counsel who’s made it clear you’ll fight. Some funders will move on to easier files rather than litigate. Not all. But some.
• They’re already overextended in court. Some of the bigger funders have hundreds of open cases. There’s a queue, and you might be at the back of it.
• Partial payments are still coming in. If they’re getting something, the math on suing changes. Lawyers cost money, even their lawyers.

The thing nobody tells you

Most business owners, when they default, spend the first two weeks thinking they have time. They’re waiting for a letter. A formal notice. A warning. It’s not coming. MCA agreements almost never require notice of default, and the funders built their entire enforcement model around speed. By the time you realize you should’ve called someone, the TRO is already in front of a judge.

If you’ve defaulted, or you’re about to, the window to do anything useful — negotiate a restructure, move to a settlement firm, get an attorney involved, protect your personal accounts as the guarantor — is measured in days, not months. The longer you wait, the fewer options you have, and the options get worse fast.