Top-Up Offers on an MCA
How to Evaluate the Deal Without Breaching the Current Agreement

A new funding offer does not have to become the next obligation. Declining it still deserves a response grounded in the existing agreement, because the conversation will often also touch a payment problem or a proposed amendment that should not be confused with the sales offer. The approval is real. Whether it helps is another matter.

Separate the Offer From the Current Account

Ask whether the proposed transaction adds a position, replaces the existing agreement, or amends it, since those arrangements carry different consequences. The sales label explains nothing about what happens to the current balance. Keep the existing schedule and the new proposal in separate records, because a representative may discuss both in one conversation while the business needs to know which obligations survive a refusal.

Where the provider suggests acceptance is necessary to avoid a consequence, request the contractual basis with the proposed terms in writing. Do not assume the statement is correct, and do not invent a universal rule that refusal can never matter. Counsel can assess the actual assertion against the signed papers. That is the honest core of the decision.

Calculate the Net Cash Before Assessing the Offer

A renewal can apply part of its gross advance to retire the earlier obligation, leaving less cash for operations than the headline amount suggests. The published financing descriptions at SBG Funding illustrate how revenue based products and marketplace terms differ, though the actual proposal must supply the figures used in any comparison. List the gross advance, the deductions, the old payoff, and whatever net deposit reaches the account in fact.

The proposal ran to nine pages with the economics buried on page seven, a placement that tells its own story about what the drafter wished to emphasize. Record the new total obligation with the collection schedule beside it, since a lower periodic payment can accompany a larger overall commitment over a longer collection period. Both effects belong in the decision, and the comparison should use the same payoff date throughout because continued collections move the old balance while proposals sit open.

As a hypothetical, consider a bakery offered a second advance nine months into the first. The gross figure glittered. The net cash covered two payrolls. Most owners feel flattered by an approval. The feeling passes, and what remains is arithmetic that governs each business day.

A statement about future renewal eligibility should never be treated as committed funding (our review of such promises is too narrow to support a rule, though the pattern favors caution). The business should evaluate the present agreement without assuming another advance arrives at the next shortfall. You take the money and then you meet the payments, which is why the reason for declining or accepting belongs in the working file in plain terms. A top up used to cover the old debit works the way a second shovel works in a deep hole: faster digging in the wrong direction.

Answer in Writing Without Unnecessary Admissions

But the reply should state the decision in narrow terms and give any existing account issue separate handling, without dramatic explanation or forecasts of financial failure. An illustrative response might read: we are not proceeding with the proposed funding, and we ask that current account questions be handled under the existing agreement. That illustration guarantees nothing about default and suits no particular dispute without counsel review.

Where litigation or an alleged default already exists, every word about inability to pay or acknowledgment of the claimed balance can carry weight beyond declining an offer. Keep the response with any reply, since a clear written exchange beats reconstruction of a telephone call later. Any statement about the account to a representative, even casually, should assume it will be read back in a different context.

Check Outside Borrowing Against Current Covenants

Declining one proposal and accepting another elsewhere are separate decisions, and the current agreement may restrict additional financing or collateral or the handling of receipts in ways a new provider never mentions. An approval from a second funder establishes nothing about permission under the first agreement, and consent language sometimes called stacking provisions deserves counsel review before anything is signed. The offer proves nothing about need, and need proves nothing about permission.

Counsel should examine the relevant rights and obligations together rather than in isolation. The review needs the old agreement, the new term sheet, and whatever consents the new provider expects the old one to supply.

Break the Cycle Before Repeating It

Weeks after the decision, the same representative often returns with a variation that changes the sales language while leaving the economics intact. Resist the urge to treat persistence as improved terms. Simply compare the new figures with the memo that recorded the earlier refusal, and let the memo speak before the conversation restarts.

Delancey Street is a debt settlement company, not a law firm, that can discuss the underlying obligations with businesses caught in repeated advances, while independent counsel reviews the agreements behind them. The company offers a free confidential initial review for owners weighing whether another advance solves the operating problem or extends it. Ensure the discussion covers the full stack of obligations rather than the latest offer alone. Ensure also that any new commitment is measured against a forecast the business prepared for its own use. The decision memo belongs with the statements, and the file stays closed until the numbers change. File the decision memo with the statements.