We can tell you what to look for in the best business debt settlement companies in Vermont. They will be licensed as debt adjusters in Vermont (or be a Vermont attorney, who are exempt from that requirement) and they will not be claiming that they can use a usury defense for your business.
What to Look for in the Best Business Debt Settlement Companies in Vermont
Make sure that they:
- are licensed as debt adjusters with the Vermont Department of Financial Regulation pursuant to 8 V.S.A. chapter 83 (or are an exempt Vermont law firm or CPA firm)
- will give you a written contract listing the debts and fees
- don't tell you that your advance is illegal usury
- know how to respond to lawsuits in the Civil Division of the Vermont Superior Court.
If your funder's contract points to New York, also learn the New York rules that govern most MCA contracts.
Does a company negotiating my MCA need a Vermont license?
Probably. The language of the statute licenses debt adjusters who negotiate with creditors "in full or partial payment of obligations of the debtor." 8 V.S.A. § 2751. This language doesn't limit the kind of debts, so it appears to cover someone who only handles business debts. And, companies who solicit business from Vermont residents by mail, phone or electronic communication are treated as doing business in Vermont. We couldn't confirm that the department enforces it against business-only negotiators, so ask any company whether it is licensed in Vermont or why it doesn't need a license.
Vermont debt adjusters must post a $50,000 surety bond, use a contract approved by the Commissioner of Financial Regulation, and may not collect any money until a contract has been signed (8 V.S.A. § 2759). They also must remit money to creditors at least every 30 days. They may only charge a maximum of $50 as a set-up fee and 10% of the payments received for distribution to creditors (8 V.S.A. § 2762). Vermont attorneys practicing law, Vermont CPAs, banks and a few others are exempt (8 V.S.A. § 2763), but there is no exemption for a company that only handles business debts.
Does Vermont's 12% interest limit help if my MCA is really a loan?
Generally, no. The legal rate of interest in Vermont is 12% (9 V.S.A. § 41a), but that statute says that rate applies "except as otherwise authorized by law." And, 9 V.S.A. § 46 does authorize a higher rate of interest on an "obligation of a corporation" or on credit extended to finance an "income-producing business or activity." So if your advance is treated as a loan, it is likely a business loan with no usury defense. We found no Vermont criminal usury rate.
However, if you are a sole proprietor and you used some of the proceeds of your advance to pay household bills, you may not fall under § 46. In that case, if the court treated your advance as a loan, the lender would forfeit all interest and could only collect one-half of the principal amount loaned if they knowingly charged a rate higher than allowed by law (9 V.S.A. § 50).
How does an out-of-state judgment reach a Vermont business?
Once the funder perfects the judgment in another state, they must file a new civil action in the Vermont Superior Court. According to the Vermont Judiciary's Civil Division website, the funder must submit a certified copy of the out-of-state judgment along with a copy of the complaint, summons and $295 filing fee. As this is a new lawsuit, you will be served and can respond. Unless waived, the case must be mediated. Most Burlington businesses fall under the Chittenden Unit. This gives you time to find a competent provider or lawyer to settle the case before the funder is able to issue trustee process (garnishments).
What can a funder take from you personally in Vermont?
If you signed a personal guarantee for the funding, the funder can reach most personal assets except those Vermont exempts:
| Type of Personal Property or Asset | $ Amount of Vermont Exemption | Statute |
|---|
| Homestead (dwelling, outbuildings, land) | $125,000 | 27 V.S.A. § 101 |
| Bank Deposits (Total for all accounts) | $700 | 12 V.S.A. § 2740 |
| Motor Vehicles | $2,500 | 12 V.S.A. § 2740 |
| Tools of Trade (including equipment, books, furnishings) | $5,000 | 12 V.S.A. § 2740 |
| Wildcard (Can be applied to any property) | $400 plus up to $7,000 of unused amounts from above | 12 V.S.A. § 2740 |
| Wages (Garnishment Limitations) | Greater of: 75% of weekly disposable earnings or 30 times the federal minimum hourly wage | 12 V.S.A. § 3170 |
While your house has real protection, nearly all the funds in your personal bank account, not to mention any company bank accounts, will be subject to the judgment. The time between service and judgment is a crucial time to get the case settled. If your chosen provider will only speak with the funder on your behalf and does not have a lawyer to answer the complaint, you may be short-handed.
Frequently Asked Questions for Vermont Business Owners
Can I cancel a debt adjustment contract in Vermont?
If the debt adjustment company is licensed in Vermont, you have 3 business days after the signing of the contract to cancel it. See 8 V.S.A. § 2759a. The licensee then has 10 days to refund all funds paid. Cancel in writing and keep proof of the date you sent it.
Is my business covered by Vermont's Consumer Protection Act if I hire a debt settlement firm?
Yes. Under 9 V.S.A. § 2451a, a consumer is defined to include a person who contracts for goods or services for the use or benefit of the person's business. If your company is in Vermont, you should be able to avail yourself of the remedies under the state's Consumer Protection Act. Consult a Vermont attorney about which remedies are available.
Does Vermont have a Commercial Financing Disclosure law like New York or Virginia?
No. As of March 2026, Vermont is not one of the ten states with a Commercial Financing Disclosure law. The ten states that have passed these laws, according to Venable's website, are California, Connecticut, Florida, Georgia, Kansas, Missouri, New York, Texas, Utah, and Virginia.
Can a debt settlement company represent my business in Superior Court in Chittenden?
Only a lawyer can represent a business in court. As a result of 8 V.S.A. § 2763, attorneys admitted to practice law in Vermont are exempt from having to be licensed as a debt adjuster in the state. This allows a law firm to both negotiate with your funder and to represent you in the Superior Court action.