Resource
Commercial recovery terms, in plain English.
A short glossary for merchants, guarantors, partners, and anyone reviewing a commercial account notice.
Who this page is for
For anyone who wants the vocabulary without the jargon fog.
Glossary
- ACH
- An electronic bank transfer through the Automated Clearing House network.
- ACH reversal
- A returned or reversed ACH debit, often because of insufficient funds, authorization issues, or bank action.
- Chargeback
- A transaction reversal. In commercial finance conversations, it usually means funds previously expected were pulled back or disputed.
- Confession of judgment
- A legal instrument used in some commercial agreements. Its enforceability varies by jurisdiction and should be reviewed by counsel.
- Daily remittance
- A daily payment or withdrawal structure commonly seen in MCA agreements.
- Factor rate
- A pricing multiplier used in many MCA agreements instead of a traditional interest rate.
- Holdback
- The percentage or amount withheld from receivables or debited toward repayment.
- ISO
- An independent sales organization or broker that introduces merchants to funders.
- MCA
- Merchant cash advance. A purchase of future receivables, commonly repaid through daily or weekly remittances.
- NSF
- Non-sufficient funds. A failed debit because the account did not have enough available funds.
- Originator
- The funder, lender, or finance company that created the original account.
- Personal guarantee
- A promise by an individual owner or guarantor to answer for a business obligation.
- Placement
- The process of assigning an account to a recovery firm for servicing or resolution.
- Portfolio buyer
- An entity that buys a pool of receivables or accounts from another holder.
- Reinstatement
- Bringing an account back into an agreed payment status after default.
- Restructure
- Changing payment timing or terms to make resolution workable.
- UCC-1 filing
- A public financing statement used to show a secured party’s interest in collateral.
- Workout agreement
- A written arrangement to resolve or cure a defaulted commercial obligation.
Need a term clarified?
If a notice uses language you do not understand, contact us with the reference number and we will explain what it means on your file.
