The Legal Ground You’re Standing On
Maryland MCA law: the three facts that shape every option
Every resolution strategy — renegotiation, settlement, defense, refinancing — plays out differently depending on these three pieces of Maryland law. A firm that can’t speak to them isn’t the best firm for a Maryland file.
1Usury limits & the recharacterization question
Maryland's usury rules are civil: Com. Law § 12-102 sets a 6% legal rate and § 12-103 permits 8% by written agreement — but § 12-103(e) exempts loans to corporations and commercial loans over $15,000 not secured by residential real property from any rate cap, so even a recharacterized MCA-sized transaction would usually face no usury ceiling (no Maryland criminal usury statute exists; third-party sites citing a "24% criminal cap" are misreading a civil tier). Maryland's real story for MCA merchants isn't usury — it's that confessed judgments remain live in commercial cases here.
Sources: Md. Code, Com. Law § 12-102 (legal rate) · Md. Code, Com. Law § 12-103 (rates; business exemptions)
2Confessions of judgment in Maryland
Live in commercial contracts — highest-risk state Maryland is one of the few states where confessed judgments remain fully available in commercial cases: under Md. Rule 2-611, a creditor files the instrument containing the confession clause plus an affidavit, the clerk enters judgment, and the burden shifts to the defendant to move to open or vacate with a meritorious defense. Consumers are protected — Com. Law § 13-301(12) and Goshen Run v. Cisneros (2020) bar confessed-judgment clauses in consumer contracts — but MCA agreements are commercial, so the ban does not reach merchants. Funders have used Rule 2-611 against Maryland businesses, pairing the judgment with immediate garnishment; in Resnick v. KrunchCash, the Eleventh Circuit held Maryland's clerk-issued garnishment may violate due process because the debtor's accounts freeze before any hearing. A Maryland MCA contract with a confession clause is the single most urgent item an advisor should review.
Sources: Md. Code, Com. Law § 13-301(12) (consumer COJ ban) · Bradley — Goshen Run v. Cisneros (consumer contracts) · Steiner Law Group — Rule 2-611 practice and the 11th Circuit ruling
3Commercial financing disclosure: where Maryland stands
Maryland has repeatedly come close but never enacted a commercial financing disclosure law: SB 496 (2023) passed the Senate 47-0 before dying in the House Economic Matters Committee, and the 2025 Small Business Truth in Lending Act (HB 693/SB 754) did not reach the Governor's desk. As of the March 2026 Venable survey, Maryland is not among the ten enacted states. Combined with live commercial confessed judgments, that makes Maryland one of the most funder-favorable large states — pre-signing review and early professional help matter more here than almost anywhere.
Sources: Maryland General Assembly — SB 496 (2023) status · Maryland General Assembly — HB 693 (2025) status · Venable — State Commercial Financing Disclosure Laws (Mar. 2026)
How funders actually enforce here: Maryland funders can enforce directly: a funder holding a confession clause files under Rule 2-611 in circuit court, obtains judgment without trial, and can immediately seek writs of garnishment that freeze the merchant's accounts while the 30-day window to move to vacate runs — the exact sequence in Resnick v. KrunchCash. Out-of-state judgments domesticate under Md. Code, Cts. & Jud. Proc. § 11-802 with the same effect as Maryland judgments. Funders also perfect UCC-1 liens against receivables through SDAT, Maryland's central UCC filing office. If a Maryland business receives a Rule 2-611 notice, the 30-day vacate window is the case — move within it. Md. Code, Cts. & Jud. Proc. § 11-802 (foreign judgments) · Steiner Law Group — Rule 2-611 confessed judgment and garnishment practice · Maryland SDAT — UCC filing and search
