Question 1

Does Michigan require MCA providers to disclose APR to cleaning companies?

Accepted Answer

No. Michigan has not enacted a commercial financing disclosure law as of mid-2026. Michigan cleaning and janitorial businesses have no statutory right to receive a factor rate, total repayment amount, APR, holdback percentage, or any standardized cost disclosure before an MCA closes. States with active disclosure requirements include California (SB 1235 + SB 362, full APR required), New York (S5470B, APR required), Virginia (HB 1027), Connecticut (PA 23-201 for advances under $250,000), Texas (HB 700, total dollar cost required), Georgia (SB 90, dollar-cost), and Florida (HB 1353). Michigan is not among them. Because Michigan providers face no disclosure obligation, you must request in writing before signing or paying any application fee: (1) the exact factor rate; (2) total repayment amount in dollars; (3) holdback percentage or fixed daily ACH amount and estimated daily or weekly payment; (4) all fees — origination, broker, administrative, any early-payoff penalty; (5) the governing-law and forum-selection clause; (6) whether a confession-of-judgment clause is present and which state it names. A $50,000 advance at a 1.28 factor rate requires $64,000 in total repayment — $14,000 in cost. Repaid over 120 business days, that annualizes to roughly 87% APR. Use the [MCA calculator](/calculator) to run this on every offer before comparing alternatives.

Question 2

Can an MCA provider use a confession of judgment against my Michigan cleaning business?

Accepted Answer

Yes. Michigan permits confessions of judgment under MCL § 600.2906 of the Revised Judicature Act, which allows entry of judgment in a circuit court upon a plea of confession signed by an attorney of that court. Michigan's procedural requirement — that the authority to confess judgment must appear in an instrument distinct from the underlying contract — adds modest friction compared with Ohio (where cognovit notes can be embedded in the original financing agreement under ORC § 2323.13), but Michigan courts have enforced COJ clauses that meet this requirement (see USA Jet Airlines v. Schick, 2001). This is not a Wisconsin-style categorical ban. More practically, most MCA agreements include a forum-selection clause designating Ohio or Utah as the enforcement venue — where COJ enforcement is broader and more reliable. A valid Ohio COJ judgment is registerable in Michigan under the Uniform Enforcement of Foreign Judgments Act, so a Michigan cleaning company that signs an Ohio-forum MCA contract faces real COJ exposure without necessarily triggering Michigan's procedural requirement at all. New York's 2019 CPLR § 3218 amendment bars NY courts from entering COJ against out-of-state borrowers, which protects Michigan cleaning businesses from New York-forum COJ actions specifically — but Ohio and Utah forum-selection clauses remain fully exposed. Before signing: search the full contract for 'confession of judgment,' 'cognovit,' and 'warrant of attorney to confess judgment.' For advances above $50,000, have a Michigan business attorney review the contract. See the full guide at [/blog/confession-of-judgment-mca](/blog/confession-of-judgment-mca).

Question 3

Does Michigan charge sales tax on commercial cleaning services?

Accepted Answer

No. Michigan does not impose sales tax on janitorial or cleaning services. Michigan's Sales Tax Act taxes tangible personal property; cleaning and janitorial services are not among Michigan's enumerated taxable services. A Michigan cleaning company performing office cleaning, floor maintenance, window washing, or industrial facility cleaning does not collect or remit Michigan sales tax on those service invoices. This is a meaningful operational distinction from neighboring states: Pennsylvania taxes building cleaning at 6–8% under 61 Pa. Code § 60.1; Ohio taxes commercial cleaning above $5,000/year in revenue under ORC § 5739.01(B)(3)(r); New Jersey taxes cleaning services at 6.625%; Texas and Florida both tax commercial cleaning. Michigan's no-tax position simplifies billing and removes the compliance layer those states impose. One caveat: if you separately itemize and sell cleaning supplies or products to a client (as personal property sold at retail), that portion of the invoice may be subject to Michigan's 6% sales tax. Confirm your specific scope with a Michigan CPA, particularly if any contracts include a product-supply component.

Question 4

Does Michigan require a business license for cleaning or janitorial companies?

Accepted Answer

Michigan has no statewide occupational license specific to commercial cleaning or general janitorial services. Standard formation and compliance requirements apply: LLCs and corporations register with the Michigan Department of Licensing and Regulatory Affairs (LARA) Corporations Division; sole proprietors using a trade name register an assumed business name with their county clerk. Three practical compliance requirements beyond entity formation: workers' compensation coverage for employers with three or more employees (Michigan's competitive private carrier market); general liability insurance (typically $1M–$2M per occurrence, required by automotive campuses, Corewell Health, Henry Ford Health, and most commercial property management vendors); and a janitorial surety bond for institutional and government contracts. Specialty cleaning that involves pesticide application (pest control, mold remediation using chemical agents) requires a Michigan Department of Agriculture and Rural Development (MDARD) Commercial Pesticide Applicator License. Post-construction cleaning operating as a general contractor may require registration under LARA's Bureau of Construction Codes depending on contract scope. Individual municipalities impose their own business license requirements; Detroit, Grand Rapids, Lansing, Flint, and Ann Arbor all require local business licenses renewed annually.

Question 5

What workers' compensation rules apply to Michigan cleaning companies?

Accepted Answer

Michigan requires workers' compensation coverage for employers with three or more employees at any one time, or any employer who regularly employs one or more workers for 35 or more hours per week for 13 weeks or more per year, under the Michigan Workers' Disability Compensation Act (Act 317 of 1969). Michigan's WC market is competitive — private carriers including Zurich, Liberty Mutual, Travelers, The Hartford, and Citizens Insurance write Michigan workers' compensation. Unlike Ohio, Washington, North Dakota, and Wyoming (which are monopolistic fund states), Michigan cleaning companies shop for competitive WC rates in the private market. The Workers' Disability Compensation Agency (WDCA) administers the Michigan assigned claims facility for coverage of last resort. The primary NCCI classification code for janitorial service contractors is 9015; specialty categories (post-construction cleanup, carpet extraction, pressure washing, mold remediation) may carry different codes — confirm your specific classification with your carrier. LLC members and corporate officers may elect to exclude themselves from WC coverage under certain conditions; confirm eligibility and the exclusion process with a Michigan WC attorney or your carrier.

Question 6

What is Michigan minimum wage for cleaning employees in 2026?

Accepted Answer

Michigan minimum wage is $13.73 per hour effective January 1, 2026 (up from $12.48 in 2025), under the Improved Workforce Opportunity Wage Act. The rate is scheduled to rise to $15.00 per hour on January 1, 2027. Tipped employees have a separate rate ($5.49/hr in 2026, which is 40% of the standard rate). Michigan's minimum is the statewide floor; no Michigan city has enacted a higher private-sector minimum wage. At the competitive market level, Michigan commercial cleaning companies that hold automotive campus or healthcare system contracts typically pay crew leads $15–$20/hour and account managers $18–$25/hour — the legal minimum is the floor, not the operating rate, for established operators with institutional clients. Michigan's Prevailing Wage for State Projects Act (Act 10 of 2023, effective February 13, 2024) restored prevailing wage requirements for state-sponsored public-sector work — cleaning contracts on state buildings, school facilities, and publicly funded construction projects covered by Act 10 require wage rates set by the Michigan Department of Labor and Economic Opportunity (DLEO), which run substantially above the $13.73 minimum. Contractors working on covered state-sponsored projects must register with DLEO and pay a $500 annual fee. Verify prevailing wage rates by county and classification at michigan.gov/leo.

Question 7

Should a Michigan cleaning company use an MCA or invoice factoring?

Accepted Answer

For Michigan cleaning companies whose primary clients are Ford Motor Company, General Motors, Stellantis, or Tier 1 automotive suppliers — invoice factoring should be quoted before any MCA. GM, Ford, Stellantis, and large Tier 1 suppliers (Magna International, BorgWarner, Aptiv, Lear Corporation) are investment-grade institutional accounts with receivables that make excellent factoring collateral. Factors advance 80–95% of outstanding invoice value at 1–4% per 30 days. On a $50,000 outstanding automotive-campus invoice factored at 2% over 30 days, factoring costs $1,000. A 1.28-factor MCA on the same amount costs $14,000 — 14 times higher. Corewell Health and Henry Ford Health are similarly strong factoring counterparties — healthcare institutional invoices from major systems are standard factoring collateral and almost always cheaper to factor than to use an MCA against. An MCA wins when you need capital in 24–48 hours before a factoring relationship is established, your client base is smaller businesses that factors won't accept, or you need capital for bonding, equipment, van fleets, or new-contract onboarding costs not tied to a specific outstanding invoice. The absence of a Michigan sales tax obligation and Michigan's relatively lower minimum wage (vs. Illinois, New Jersey, or Connecticut) mean your gross margins may support MCA repayment — but factoring remains the first-choice tool for established operators with institutional receivables.

Question 8

What factor rate should a Michigan cleaning company expect?

Accepted Answer

Established Michigan cleaning companies — 3+ years in business, consistent monthly deposits of $20,000+, 620+ personal credit, current WC and GL certificates, no active MCA stack — typically see 1.18–1.28. Mid-tier operators (1–3 years, some deposit variability, 580–620 credit) typically see 1.28–1.38. Newer operations or solo operators with deposit gaps typically see 1.38–1.45. Because Michigan requires no APR disclosure, providers have no obligation to state the annualized cost — use the [MCA calculator](/calculator) to compute it independently before comparing any offer against alternatives. Commercial cleaning operators whose deposit history understates contracted volume because automotive or healthcare clients cluster net-45/60 payments should apply after a strong deposit month and bring contract documentation: recurring contracted revenue from an OEM campus, healthcare system, or federal facility reduces underwriting risk and can improve the rate. Detroit-area cleaning companies with Bedrock or Detroit Housing Commission contracts, or Grand Rapids operators with Corewell Health West or Amway campus accounts, should document those relationships explicitly in the application — institutional anchors demonstrate revenue durability that deposit averages alone may not show.

Profile	Factor Rate Range	Estimated APR (6-month repayment)
Established (3+ years, $20K+/mo deposits, 620+ credit)	1.18–1.28	~42–66%
Mid-tier (1–3 years, variable deposits, 580–620 credit)	1.28–1.38	~66–90%
Early-stage or deposit gaps	1.38–1.45	~90–107%

Merchant Cash Advance for Michigan Cleaning & Janitorial Businesses: 2026 Guide

Three Michigan Demand Drivers

Automotive Corporate Campus and Tier 1 Supplier Plant Cleaning

Corewell Health + Henry Ford Health: Institutional Healthcare Cleaning

Detroit Commercial Real Estate and the Bedrock Portfolio

Michigan Regulatory Facts for Cleaning Operators

Factor Rates and What Michigan Cleaning Advances Actually Cost

Michigan Funding Alternatives to Compare First

Ready to see which options fit your business?