The best business debt settlement companies in Tennessee are the ones that can settle your MCA before you are personally sued. Tennessee only allows for a $35,000 homestead exemption and a $10,000 wildcard exemption, so picking a provider that works with Tennessee litigation counsel is important.
We do not have a list of the best companies yet as the data has not been published. Here is the Tennessee law that should guide your choice:
If Tennessee voids confessions of judgment, how can a funder still get a judgment against you?
The funder will either sue you here or enroll an out of state judgment. Tennessee Code Section 25-2-101 declares void any authority to confess judgment given “before an action is instituted and before the service of process,” and any judgment based on it.
In Capital Partners Network OT, Inc. v. TNG Contractors, LLC (Tenn. Ct. App. 2020), the Tennessee Court of Appeals held that an out of state confession of judgment was subject to full faith and credit in Tennessee because the business and guarantor had knowingly and voluntarily waived due process. A Florida funder obtained a $96,124.23 New York confession of judgment, based on an affidavit confessing $176,250 less receivables delivered plus legal fees of 33%, and enrolled it in Davidson County Circuit Court. The fight took about 3 years and 2 appeals, and the funder won. New York will no longer enter confessions of judgment against out-of-state debtors as of August 2019, so funders now usually sue and then enroll the judgment in Tennessee. Read our blog post about confessions of judgment.
What can a funder take from you personally in Tennessee?
Tennessee allows for less exemptions than most states, and it has opted out of Federal Bankruptcy exemptions. See Tenn. Code § 26-2-112.
| Assets Exempt from Collection in Tennessee | What Tennessee protects | Tennessee Statute |
|---|
| Principal Residence | $35,000 per individual; $52,500 for joint owners sued in the same proceeding. | Tenn. Code § 26-2-301 |
| Personal Property & Bank Deposits | $10,000 total equity, debtor’s choice of property. | Tenn. Code § 26-2-103 |
| Wages | Garnishment limited to the lesser of 25% of weekly disposable earnings or the amount above 30 times the federal minimum hourly wage, plus $2.50 a week per dependent child under 16. | Tenn. Code §§ 26-2-106 & 26-2-107 |
You can only protect $10,000 in equity across your car, personal bank account, and household goods. See our blog post about what a MCA funder can take if you personally guaranteed the loan. See also our page on the best business debt settlement companies in Kentucky.
Does owning your home with your spouse protect it from an MCA guarantee?
Maybe. Tennessee allows for property to be held as Tenants by the Entirety. Tenn. Code § 36-3-505. The Tennessee Supreme Court has held that a creditor of one spouse can execute on that spouse’s right of survivorship, but not on the couple’s present right of occupancy.
However, in SmartBank v. Stephens (Tenn. Ct. App. 2019), the Court of Appeals held that a creditor of one spouse could sell that spouse’s right of survivorship in the marital home. This clouds title and makes a later sale or refinance harder. Tennessee’s version is weaker than Maryland’s or Florida’s.
Is your merchant cash advance usurious under Tennessee law?
Probably not. All signed, written contracts must charge the formula rate or less. The Department of Financial Institutions set that rate at 10.85% on September 22, 2026. The formula rate cannot exceed 24%. Moreover, a discount or other fee taken in an “account purchase transaction” is not “interest” under Tennessee’s usury statute. See Tenn. Code Ann. § 47-14-102(8). No Tennessee appellate court has yet defined an “account purchase transaction.” A usury claim therefore has to get past that carve-out first, usually by showing the purchase agreement lacks the hallmarks of a true sale, like a reconciliation provision, an open-ended term, etc. If usury is found, the funder collects only principal plus lawful charges. See Tenn. Code Ann. § 47-14-117.
What should business debt settlement companies in Tennessee do once you're sued?
The best business debt settlement companies in Tennessee will answer the lawsuit on time. If they do not answer in time, you could lose all of your defenses, including usury. The owners of a Chattanooga radio business waited too long to assert usury against Flexibility Capital. Flexibility advanced $16,320 against a $24,140 purchased amount, collected at $164.22 each weekday. The court granted summary judgment because the business failed to respond to Flexibility’s Statement of Facts. Only then did it raise usury, and the trial court ruled that was too late. The Tennessee Court of Appeals dismissed the radio business’ appeal as untimely. See Tulis v. Flexibility Capital. A subsequent lawsuit in Federal Court was also dismissed in 2025.
When interviewing business debt settlement providers in Tennessee, ask the following questions:
- What is the name of the licensed Tennessee attorney that will answer the lawsuit in General Sessions, Circuit, or Chancery Court?
- How will you defend me if the funder sues in another state under my contract’s forum clause?
- What will you do to settle the lawsuit before the 30-day execution window closes and before the funder can register its judgment as a lien against my land?
- Do they understand the account purchase carve-out from the usury statute?
- How much do they charge? See our blog post on How Much Does Business Debt Settlement Cost?
Frequently Asked Questions about Merchant Cash Advances in Tennessee
How long after the funder gets a judgment against me in Tennessee can they levy on my bank account?
Generally, 30 days. An out of state judgment enrolled in Tennessee cannot be executed until 30 days after the summons is served on you. For a Tennessee court judgment, under Rule 62.01 execution waits 30 days after entry unless you are about to fraudulently dispose of property.
In what court in Tennessee will the funder sue me?
General Sessions Court hears civil cases of $25,000 or less; Circuit and Chancery Courts hear larger ones. The Davidson County Business Court Docket takes cases alleging at least $250,000. Often, however, funders sue in another state under a forum clause, and Federal courts in Tennessee have enforced these clauses.
How can a judgment be registered as a lien on my land in Tennessee?
The creditor must file a certified copy of the judgment in the lien book of the register in the county where your land sits. If properly and validly filed, a Tennessee judgment can be enforced for 10 years.
Does Tennessee require any disclosure or registration by funders of merchant cash advances?
As of September, 2026, Tennessee has no commercial financing disclosure or registration law, so you will not have the leverage a missing registration creates elsewhere.