SBA Debt Attorneys

Charge off is the process by which the SBA recognizes a loss and removes the uncollectible loan account from its active receivable accounts. The SBA’s policy is to be diligent and thorough in collection of federal debt and to promptly charge off all uncollectible accounts to more accurately reflect the status of the individual account and the Agency’s entire portfolio. It should be noted that a charge off is merely an administrative determination that does NOT affect SBA’s rights against any obligor nor reduce the SBA’s (or a participant lender’s) ability to proceed with any available remedy.

An SBA loan is a small business loan made by a private sector lender (such as a local bank or other lender) which is guaranteed by the United States Small Business Administration (“SBA”) pursuant to the terms of the U.S. Small Business Act, as amended (“Act”).

Subchapter V allows debtors to spread their unsecured debt over 3 to 5 years. During this time, the debtor must devote their disposable income toward the debt. This model usually aids both parties involved.

The debtors have time to pay their debts and can spread them across a more extended period to avoid large sums. The creditors benefit because there is less a chance of debtors defaulting on longer-term payments.

Administrative expenses differ from Subchapter V to Chapter 11 cases. Debtors must pay administrative costs at plan confirmation in Traditional Chapter 11 cases. Debtors can pay Subchapter V administrative expenses over the life of the plan.

For both, however, debts are not discharged until the debtor completes all of its planned payments.

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Yes, as long as you meet the criteria above individuals may avail themselves of Subchapter V.

If a Borrower or Obligor does not respond to the opportunity to submit an Offer in Compromise, they may be referred to the U.S. Department of Treasury for various enforced collection activities.