Have you been contacted by Headway Capital about an outstanding business line of credit? Dealing with lenders over an unpaid debt can be challenging, and it’s critical that you understand your rights.
Here’s what you need to know about how Headway Capital operates and what to do if you’ve been contacted about a debt you owe.
Who Is Headway Capital?
Headway Capital is a small business lender that specializes in revolving lines of credit.
Is Headway Capital Legitimate?
Yes, Headway Capital is a legitimate business and has been in operation for more than a decade. Its parent company, Enova International, is a publicly traded company.
However, while Headway Capital is a real business, it’s not accredited by the Better Business Bureau. Before working with the lender, it’s important to understand how it works and the potential pitfalls of taking out a short-term line of credit or MCA for your business.
Overview of Headway Capital
Founded in 2014, Headway Capital offers short-term lines of credit to small business owners in 41 states and the District of Columbia.
The lender boasts of transparent payment terms, no compounded interest, and no early repayment penalty.
Headway Capital Reviews and Complaints
Headway Capital has a B- rating from the Better Business Bureau (BBB), largely due to its failure to respond to two complaints filed against it.
The company only has a handful of reviews with the BBB, most of which are negative. However, it does maintain an average rating of 4.6 out of 5 stars across more than 2,220 reviews on Trustpilot.
The Consumer Financial Protection Bureau doesn’t have a record of complaints about Headway Capital. However, the federal agency received 702 complaints in 2024 about its parent company, Enova International. Issues include reporting incorrect information to the credit bureaus, unexpected fees and interest charges, and attempts to collect debts not owed.
Understanding How Headway Capital Operates
While Headway covers several different types of business financing on its website, it only offers a line of credit, which it calls the True Line of Credit. The lender specializes in working with newer businesses, requiring just six months of operating history and $50,000 in annual revenue to get approved.
Loan amounts range from $5,000 to $100,000, with weekly or monthly payments over a term of 12 to 24 months. As with other revolving lines of credit, you only have to pay interest on what you borrow.
However, borrowers in most states will be subject to a 2% draw fee each time they pull money from their credit line. Monthly interest rates may range from 3.3% to 6%, with an average of 4.6%.
Dealing with Headway Capital
If you’ve been contacted by Headway Capital about a debt it claims you owe, it’s important to know your rights and the best way to handle communications with the lender.
What Should I Do if I Receive a Letter or Call from Headway Capital?
If Headway Capital reaches out to you, it’s crucial that you first verify that the communication is legitimate. Review the contact information, such as the email address, phone number, and address, and try to match it with information you find on the lender’s website.
You may even call Headway Capital at the number listed on its website to confirm.
Once you’ve verified the legitimacy of the letter or phone call, read or listen carefully to ensure that you know why they’re reaching out. For example, it may simply be a marketing call, or it may be about an unpaid debt.
If they’re contacting you about a debt, you can ask the company to validate the debt in writing. If they’re threatening legal action, it may be a good idea to consult with an attorney.
Handling Communications from Headway Capital
It’s critical that you document each and every interaction you have with Headway Capital. That includes keeping a copy of letters and emails and recording or taking notes during phone calls.
Documenting your communications can help you safeguard your rights as a borrower, and it can also come in handy if the lender decides to take legal action against you.
Knowing Your Rights against Headway Capital
Whether you’re dealing with Headway Capital or another financial institution, there are certain rights you enjoy as a consumer. Here’s a quick summary of what you can expect.
- Right to transparent information: You have the right to clear, understandable information about the terms of any financing agreement. All costs associated with the financing, including any potential penalties for late payments or early repayment, must be disclosed before you agree to the terms.
- Right to privacy: Your personal and financial information must be protected according to applicable data protection laws. Your information should not be shared with third parties without your consent, except as required by law, and you have the right to know how your information is used and by whom
- Right to fair treatment: Lenders cannot discriminate against you based on race, religion, nationality, gender, marital status, age, or disability. Headway Capital is not allowed to engage in deceptive practices and must treat you honestly and fairly.
- Right to redress: You have the right to prompt correction of any errors in your account statements or transactions. You should also have access to a fair and efficient process for resolving complaints and disputes.
- Right to withdraw: Depending on local laws, you may have the right to withdraw from the credit agreement within a specified period after signing, usually without penalty.
The Legal Side of Headway Capital
Common Legal Issues with Business lenders like Headway Capital
As with other business lenders, Headway Capital may try to sue you over unpaid debt. Because it primarily targets newer businesses and its business line of credit offers short repayment terms, you may be at a greater risk of defaulting on your debt compared to a standard business line of credit.
What Happens If You Get Sued by Headway Capital?
If Headway Capital decides to take legal action against you over an unpaid debt, here’s a quick summary of what the process would look like and steps you can take to protect yourself:
- Receive the complaint: You’ll typically find out that you’re getting sued when you’ve been served the complaint by the lender. This document should outline the company’s claims against you and the money it’s seeking.
- Review the documents: Before taking any next steps, make sure to read and fully understand the lawsuit and any documents you have related to the debt. If there’s anything in the complaint you believe to be inaccurate, take note of it.
- Seek legal help: While you can technically defend yourself against Headway Capital, it’s in your best interest to seek the best possible legal advice when dealing with a business lender. An experienced debt attorney can guide you through the process and alleviate some of the burden.
- Response: You’ll typically need to respond to the lawsuit within 20 to 30 days of receiving it. In your response to the court, you may deny the lender’s claim or raise possible defenses or counterclaims. A business debt relief attorney can help you develop and file your response to the Court.
- Discovery: During discovery, you and the lender will exchange relevant information about the case. If you’ve hired an experienced business debt attorney, they can manage the discovery process on your behalf.
- Negotiation and settlement: In many cases, debt lawsuits are settled before they even head to trial. If you believe that a settlement is right for you, your attorney should assist you and ensure that you get the best possible settlement deal.
- Trial: If you and the lender can’t reach a settlement, your case can go to trial. Both you and the lender will have the opportunity to argue your case. Having an attorney who understands the legal process as it relates to debt collection lawsuits to represent you can make all the difference.
- Judgment: If the case has gone to trial, the final step in the process is the judge’s decision. The judge will make a decision based on the details of the case and determine how much you’re required to pay (if anything) and which steps the creditor can take to collect the money.
How to Negotiate with Headway Capital
Regardless of whether you’re being sued, you may be able to negotiate your debt with Headway Capital and settle for less than what you owe. Here are some steps you can take.
Check to Make Sure Headway Capital Isn’t a Scam
The business financing industry is rife with scammers looking to take advantage of unsuspecting business owners. If someone contacts you claiming to be Headway Capital and saying that you owe money, it’s crucial that you verify the claim before trying to negotiate.
If you’re taken advantage of by a scammer, it won’t resolve your debt with Headway Capital, and you may not have any recourse to get your money back.
To verify that it’s not a scam, verify the contact information of the person reaching out to you. You may also want to reach out to Headway Capital directly through its website or via the contact details below.
Strategies for Negotiating with Headway Capital
If you’re looking to negotiate a debt settlement with Headway Capital, here are some things you can do to be as effective as possible:
- Understand the situation: Before going into any negotiations, it’s important that you understand exactly what you agreed to when you signed your credit agreement. You’ll also want to verify the amount you owe, including interest charges, late fees, and other potential charges.
- Have a goal in mind: Going into negotiations without a clear objective can leave you at the mercy of the creditor. If you come into the process with a specific idea of how much you’re able to pay—either as a lump sum or a monthly payment—you’ll be more likely to be met by a willing negotiation partner.
- Organize your documents: Hold onto any document you receive about the debt or the negotiation, and keep everything organized for easy access. Disorganization could favor the lender.
- Remain professional: While you’ll want to be persistent throughout the negotiation process, it’s critical that you remain calm and professional. The process can take time, and patience is key and having an advocate like a business debt attorney or MCA attorney is beneficial.
- Seek legal advice: Although you can negotiate on your own, you may have a better chance of achieving your goal if you enlist the help of an experienced business debt relief attorney. An experienced debt attorney can guide you through the process to help you achieve the best possible outcome, and help protect your assets and business income during the process.
How to Protect Against Headway Capital
Regardless of whether you owe money to Headway Capital, you have the right to protect yourself. Here’s a summary of what to do.
Steps to Take If You’re Contacted by Headway Capital
As a brief recap, here are the first steps you should take if Headway Capital reaches out to you about an unpaid business debt:
- Verify the communication: If you receive a letter or phone call from Headway, start by confirming it’s legitimate.
- Ask the lender to validate the debt: Ask Headway to validate your debt, which they should do in writing. Compare the information you receive to your own records about what you owe.
- Consult an attorney: If you’re overwhelmed or would feel more comfortable having someone help you through this process, consider hiring a debt relief attorney.
- Decide on your next steps: Weigh your options and decide what to do next, whether it’s pay the debt, negotiate with the company, or go to court.
Filing a Complaint against a creditor like Headway Capital
If you believe that Headway Capital has violated your rights or you have another type of complaint against the company, you can report the issue with the following organizations:
- Consumer Financial Protection Bureau
- Better Business Bureau
- State Attorney General
- Federal Trade Commission
Headway Capital Phone Number and Address
If you have any questions, here’s how you can get in touch with Headway Capital:
- Phone number: 866-698-8494 (customer service) or 866-698-9938 (collections)
- Email address: support@headwaycapital.com or collections@headwaycapital.com
- Address: 175 W Jackson Blvd, Suite 1000, Chicago, IL 60604
How Can a Debt Settlement Attorney Help?
If you’re dealing with an outstanding debt or a lawsuit, a debt relief attorney experienced in dealing with MCA’s and lenders like Headway Capital can advise you on your next steps and negotiate with the company on your behalf for a new agreement.
Tayne Law Group offers a free phone consultation with an experienced staff member which can include a debt relief attorney. Whether you’ve already been sued or are simply worried about the best way to handle your debt, we may be able to help. Contact our offices today by calling (866) 890-7337 or filling out our short contact form. We never share or sell your information, and all conversations are confidential.
FAQs
Is Headway Capital a Direct Lender?
Yes, Headway Capital works directly with business owners to provide financing through a short-term business line of credit.
Does Headway Capital Report to the Credit Bureaus?
Headway Capital performs a soft credit check when you apply, which won’t negatively impact your credit score. However, online reports also suggest that the lender doesn’t report your payments to the commercial or consumer credit bureaus. In other words, you can’t use a line of credit from the lender to build your business credit history.
Who Is the Parent Company of Headway Capital?
Headway Capital’s parent company is Enova International, which also owns Ondeck, another online business lender.
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Please include at least 3 proposed headlines in the table above
Instructions for Writer/Outline
Create a debt collector page based on the outline below (same as MCA page). Note that these pages follow a specific format. This page will be published in the same section and follow a similar template as these and others:
https://attorney-newyork.com/mca-lender/forward-financing-debt-relief/ https://attorney-newyork.com/mca-lender/kalamata-capital-group-debt-relief/
This page aims to give a business owner contacted by Headway Capital as much info as possible about this business and person lender and what to do next. Ideally, they contact TLG for help.
Note that they don’t provide MCAs, but they appear to position themselves as an alternative to MCAs, as shown here: https://www.headwaycapital.com/merchant-cash-advance
