First, figure out when the answer is due. In New York, it’s 20 days from delivery if you were personally served, or 30 days from “completion of service” for most other methods. In Pennsylvania, it’s 20 days. Second, get the business a lawyer. Third, decide on dismissal or removal. Finally, answer.
For the steps between this one and trial, see what happens when an MCA files a lawsuit.
What exactly were you served?
Read the caption to see whether this is a lawsuit, a confessed judgment, or an arbitration. A confession of judgment can be entered “without an action” under CPLR 3218. If a Notice of Motion for Summary Judgment under CPLR 3213 came with the summons instead of a complaint, your response is opposition to the motion, due on the date the Notice of Motion sets, which cannot be earlier than your 20 or 30 day time to appear. Arbitration matters too: in June 2026 the New York Attorney General sued Rapid Ruling, alleging around 3,000 arbitrations in which the businesses almost never appeared and the awards were turned into court judgments. If an award is entered against you, CPLR 7511 gives you 90 days from delivery of the award to move to vacate it.
Also check who was sued: the business (LLC) and the guarantor (you) are separate defendants, and if served on separate days, they have different deadlines.
How long do I have to respond to the lawsuit?
Anywhere from 20 to around 60 days. Online claims that mail service gets you 30 days are wrong: under CPLR 320(a), 30 days from completion of service applies to substituted, Secretary of State, and out-of-state service.
| Method of service | Time for response |
|---|
| Personal service in New York | 20 days after delivery |
| Service at residence or nail and mail (CPLR 308(2) or (4)) | 30 days after completion of service (10 days after proof is filed) |
| Service on the New York Secretary of State | 30 days from delivery to the Secretary of State |
| Service outside New York | 30 days after completion of service |
| Pennsylvania Court of Common Pleas | 20 days after service of the complaint (Rule 1026(a)) |
| Federal court | 21 days, or 60 if you waived service (FRCP 12(a)(1)(A)) |
With Secretary of State service, the state mails the papers to the address on file, and a stale address can eat most of your time to respond.
Can you answer for your LLC yourself?
No. Under CPLR 321(a), a corporation “shall appear by attorney.” You can appear pro se as the guarantor, but a settlement company cannot appear for the business. Get the business a lawyer this week.
Should you file a motion to dismiss or an answer first?
Often, the motion. A pre-answer motion under CPLR 3211 extends your time to answer until 10 days after notice of entry of the order deciding it. The bigger trap is improper service: under CPLR 3211(e), that defense is waived unless raised in a 3211 motion or the answer, and if raised in the answer, you must move on it within 60 days. Pennsylvania’s version is preliminary objections under Rule 1028, raising jurisdiction, venue, service, or an agreement to arbitrate.
What goes into your answer when an MCA funder is suing you?
Your answer must deny what you don’t admit, since under CPLR 3018 any allegation not denied is deemed admitted. Defenses you must plead include payment, release, fraud, and “facts showing illegality,” which is where usury fits. Businesses can raise only criminal usury (25%), because GOL 5-521 bars corporations from civil usury, and the Second Department held in LG Funding that criminal usury works as a defense but not a counterclaim. In July 2026, a bankruptcy court in In re Kossoff PLLC treated 19 advances as usurious loans.
Can I move this to federal court?
Maybe. Each defendant gets 30 days from service to remove under 28 U.S.C. 1446, and all served defendants must agree. You need diversity jurisdiction under 28 U.S.C. 1332 (different states, over $75,000 at stake). If any served defendant is from the state where the case was brought, 28 U.S.C. 1441(b)(2) bars removal. So a New York business sued in New York is stuck in state court, while a Pennsylvania business sued in Rockland County Supreme Court may be able to remove.
When is the best time to settle?
As we read the procedure, your leverage is best just before the time to answer expires, since the funder has spent little on the case yet. When you settle, insist on a discontinuance “with prejudice,” a release of the guarantor, and a UCC-3 termination. For how quickly a funder can get to default, see how fast an MCA funder can get a judgment.
What should I not do while this is pending?
Don’t move money to keep it out of the funder’s hands. Under CPLR 6201(3), the funder can seek attachment before judgment if, with intent to defraud creditors, you have “assigned, disposed of, encumbered or secreted property.”
Frequently Asked Questions
If I don’t answer in time, do I automatically lose the case?
No. In New York, the funder has to apply to the clerk or court for a default. If the funder sued an individual on a contract, or served the corporation through the Secretary of State, CPLR 3215(g) requires a second mailing and a 20-day wait before default. In Pennsylvania, the funder must first serve a 10-day notice of intention to request default.
What if the process server only served me a summons?
In New York, you can serve a written demand for the complaint while you still have time to appear. The funder then has 20 days to serve it under CPLR 3012(b), and your time to answer runs from the complaint.
What if I’ve already run out of time to defend myself?
You may still be able to. A New York court can extend the time to plead on a showing of reasonable excuse under CPLR 3012(d), and can vacate a default under CPLR 5015(a)(1) if you move within a year of service of the judgment and notice of entry. If you were not personally served, CPLR 317 gives you one year from learning of the judgment to defend, up to five years after entry. In Pennsylvania, Rule 237.3 gives you 10 days from entry to petition to open. In federal court, a default can be set aside for good cause under FRCP 55(c).
Does filing bankruptcy stop the suit against me personally?
Only if you file yourself. The automatic stay under 11 U.S.C. 362(a) protects only the filer, so if just the LLC files, the funder can keep pursuing you on your personal guaranty.