Funder guide
Settle a Kapitus advance: your options
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A Kapitus merchant cash advance can usually be settled for a reduced payoff. Because Kapitus — like other funders — generally prefers a negotiated resolution to the cost and uncertainty of suing and collecting, there is real room to negotiate the balance down, especially before a judgment is entered. You pay Kapitus directly on the agreed, reduced plan.
Also known as / related: Strategic Funding Source.
Kapitus (formerly Strategic Funding Source) is a small-business financing provider offering merchant cash advances and other products, typically repaid through automatic ACH debits tied to revenue. Its advances are typically repaid through daily or weekly ACH debits tied to your receivables, which is what makes a stack of them so hard on cash flow.
Being sued by Kapitus?
If Kapitushas filed suit, the most damaging thing you can do is nothing — an unanswered summons usually becomes a default judgment, after which the funder can move to restrain your bank account and enforce any personal guarantee. Respond within your state's window (often 20–30 days), and use the pre-judgment period to negotiate. Funders settle filed cases routinely because litigation is expensive and a judgment is only worth what they can collect.
Is a Kapitus advance a loan?
A Kapitus advance is written as a purchase of future receivables, not a loan — that structure is how merchant cash advances sit outside traditional usury and lending rules. Whether your specific Kapitusagreement is a genuine purchase or a disguised, potentially unenforceable loan turns on details like a real reconciliation clause and the funder's recourse if your business fails. That's a fact-specific legal question for a licensed attorney — but even the possibility of a challenge can add leverage at the settlement table.
Kapitus settlement — what to expect
Settlement runs in four steps: a review of your Kapitus advance(s) and balances; negotiation down to a reduced payoff; a restructured, affordable plan; and you paying Kapitusdirectly until it's resolved. With a reputable provider your settlement money never passes through them — you pay the funder directly and the provider charges only its own disclosed fee.