My business has a large receivable tied up in litigation, and that is part of why cash is tight. I am being offered MCA-style relief, but I wonder whether the receivable changes my options. Can a receivable in litigation be used for financing or negotiation, or is it too uncertain until the case is resolved?
A receivable in litigation can matter, but it is not the same as clean accounts receivable. Some lenders or litigation-finance providers may consider it, but they will look at collectability, timeline, legal risk, documentation, and whether someone else already has a UCC claim on receivables. It may also help in negotiations if funders believe there is a realistic recovery source, but you should be careful about pledging the same receivable twice. Before taking another MCA-style product, ask whether asset-based lending, invoice financing, litigation funding, settlement timing, or attorney-led negotiation could produce a cheaper path.