The best business debt settlement companies Maryland owners can hire will need a lawyer to make a motion to vacate any confessed judgments in a timely manner. They will also need to determine what a funder can reach through your personal guaranty, even when you hold property with your spouse as tenants by the entirety.
Can an MCA funder still get a confessed judgment against you in Maryland?
Yes, a merchant cash advance funder can get a confessed judgment against you in Maryland on a commercial instrument. They can do so pursuant to Md Rule 2-611 (in Circuit Court) or Md Rule 3-611 (in District Court). To get the judgment, the funder merely files the instrument with an affidavit itemizing principal, interest, fees, any payments made, and how they calculated the amount. The affidavit must also state that the instrument is not a consumer loan, a consumer transaction or a retail installment sale. (This requirement is met if you signed the guaranty in connection with your business.) The court can only enter the judgment if it finds a basis in fact and in law. The clerk then issues a notice telling you the date by which you must move to open, modify or vacate the judgment. You can learn more about confession of judgment in our explainer.
How long do I have to file a motion to vacate a confessed judgment in Maryland?
Unless you were served outside of the state in a Circuit Court action, you have 30 days to file a motion to vacate. Otherwise, you get the time allowed to answer a complaint under Md Rule 2-321:
| Service | Time to file motion to vacate |
|---|
| In Circuit Court, within Maryland | 30 days after service of the notice |
| In Circuit Court, within the United States, but outside of Maryland | 60 days after service of the notice |
| In Circuit Court, outside of the United States | 90 days after service of the notice |
| In District Court, anywhere | 30 days after service of the notice |
To get the judgment opened, you just need to show the court that there is a “substantial and sufficient basis for an actual controversy on the merits.” The court does not weigh the evidence at this point; it only asks whether your facts are arguably admissible and show a meritorious defense. (See Pease v. Wachovia SBA Lending, 416 Md. 211 (2010).) In 2020, a judge in Baltimore County vacated a $6.7 million confessed judgment against several healthcare providers because the providers showed issues with the amount of the judgment and defenses to its execution.
Note, you will need to hire a lawyer admitted to practice in Maryland to file that motion.
What protects your home and joint accounts if only you signed the guaranty?
In Maryland, there is no homestead exemption, however, property held by a husband and wife as tenants by the entirety is generally exempt from the claims of a creditor that only has a judgment against one of the spouses. The only residence exemption, in CJP 11-504, applies only in a federal bankruptcy case. $500 in a deposit account is exempt without any action. You can also exempt up to $6,000 in cash or other property if you elect it within 30 days after a levy. The $6,000 exemption can include the $500 from your deposit account. You can also exempt up to $5,000 in tools of your trade.
For joint bank accounts, pursuant to CJP 11-603, a garnishment of a deposit account held by a husband and wife is not valid unless the judgment is against both the husband and wife, as long as the account was established as a joint account prior to the entry of the judgment. Be aware, however, that it may constitute a fraudulent conveyance if you re-title assets after a claim has been asserted against you. Additionally, if your spouse signed the guaranty, then this protection will not be available. A divorce converts entireties property to a tenancy in common, which is not exempt. If you transfer property held as tenants by the entirety to a trust on or after October 1, 2010, the property remains exempt under ET 14.5-511, as long as the trust meets the statute’s requirements.
A good provider will access your property deed and account information before providing a quote because a funder who can only touch your business accounts and assets in your name only has little negotiating leverage.
When is my case part of the Maryland Business and Technology Case Management Program?
Complex commercial cases. Enforcement of judgments is presumptively not part of the business court program per Md Rule 16-308. However, once the judge vacates your confessed judgment, if there is an issue of reconciliation math, stacked advances, fraud, unfair trade practice, etc., it would be worth asking the County’s Administrative Judge to consider your case for the Business and Technology Case Management Program, which would give your case to a single judge experienced in business litigation.
What questions should I ask business debt settlement companies in Maryland?
Review the questions and our article on how much business debt settlement companies cost.
- Can you file a motion under Md Rule 2-611 or 3-611, and how do you calculate the filing deadline?
- Will you audit the funder’s affidavit amounts against the remittance history?
- Will you check how your house and bank accounts are titled? Did your spouse sign anything?
- Do you know Maryland’s usury law doesn’t apply to corporations or commercial loans over $15,000 (with exceptions) pursuant to CL 12-103(e)?
Check out business debt settlement in Virginia.
Frequently Asked Questions
Can I be held to a confession of judgment in Maryland for a business debt?
Yes. Md Rule 2-611 and Md Rule 3-611 allow for the entry of confessed judgment on commercial instruments, and a merchant cash advance guaranty for a business purpose would qualify.
Can the funder take my money out of my bank account during the 30 days?
They can serve the bank and freeze your account, but under Md Rule 2-611(f), unless the court orders otherwise, no garnishee can pay over the money to the creditor and the execution sale can’t take place until the motion period has expired and any motion has been decided.
Do business debt settlement companies need to be licensed in Maryland?
Debt Settlement Services require registration with the Maryland Office of Financial Regulation, but the Debt Settlement Services Act defines a consumer as an individual who resides in Maryland, so a company that only negotiates business debt generally falls outside it.
Does Maryland have a commercial financing disclosure law?
Not as of September 2026. The Small Business Truth in Lending Act made it through the Maryland Senate 42-0 in March 2026 (SB 881) but did not get further in the House Economic Matters Committee.