If you Owe more than $30,000 contact us for a case evaluation at (833) 428-0937
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Understanding SBA Loan Defaults

Understand SBA loan defaults, repercussions, & pathways to navigate this complex scenario. Learn about resources like Protect Law Group for professional help.

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What is an SBA Loan Default?

Are you finding yourself wrestling with the complications of your Small Business Administration (SBA) loan agreement? Have you found yourself in a default status, grappling with the potential consequences this may have on your personal or business assets?

In the world of SBA loans, defaulting is one issue you don’t want to overlook. It occurs when you fail to meet your loan repayment obligations and can lead to severe repercussions that could jeopardize your financial health and the continuity of your business.

By navigating the complexities of SBA loan defaults, you’ll gain a better understanding of your situation and how to manage it. Plus, you’ll learn how you can benefit from the expert legal services offered by firms such as Protect Law Group, specializing in addressing and resolving SBA and Treasury debt issues.

Let’s delve into the intricate world of SBA loan defaults.

SBA Loan Default – An Overview

When you obtain an SBA loan, you establish an agreement with your lender to repay the loan within a certain timeframe. If you fail to make your loan payments, you enter a period of delinquency. If this delinquency remains long enough, your loan will default, and the SBA may seize the assets you placed as collateral.

But don’t panic just yet. The first thing you should do is understand the measures and options available to get you out of this tricky situation. Resources shared by organizations like Protect Law Group may assist in understanding your default status and in potentially resolving your SBA debt collection matter.

The Role of Protect Law Group

The intricate processes involved in SBA loans and debts need professional attention. This is where Protect Law Group shines. The firm is dedicated to representing small business owners and federal debtors across the U.S., specializing in a variety of legal services associated with SBA loans.

With the knowledgeable attorneys at Protect Law Group, you can expect to learn about your options and get assistance to create and implement an efficient plan to steer you out of your SBA loan complications.

The expert services of Protect Law Group encompass:

  • Advocacy for your positions using relevant legal authorities
  • Detailed reviews for filing Appeals Petitions
  • Investigation procedures concerning factual, legal, and procedural errors
  • Active response to administrative notices from the SBA regarding various forms of offset

The professionals at Protect Law Group are fully capable of representing federal debtors nationwide at any needed governing body and provide you with the most current and relevant information on your case.

Key Services Offered by Protect Law Group

Protect Law Group excels in various areas concerning SBA loan defaults, including:

SBA Offer in Compromise (OIC)

This enables your business to settle the SBA debt for a lesser amount than you owe.

Structured Workout

A tailor-made agreement that enables you to repay your debt over a more extended period.

Administrative Litigation

The attorneys at Protect Law Group can represent you in litigation happening at the SBA Office of Hearings and Appeals.

Negotiations

Protect Law Group negotiators can work with your lender to ensure you get the best possible terms for your repayment.

Litigation Services

If sued by the SBA, Protect Law Group can help establish the best course of action.

Cross-Servicing Disputes

Help prepping formal appeals for cross-servicing disputes with the Bureau of Fiscal Service should your debt be transferred.

By helping your business minimize SBA debt-related damage, you can avoid undesirable consequences such as bankruptcy or foreclosure.

Benefits and Distinguishing Features

With a consistent track record of delivering optimal web-carried services, Protect Law Group prides itself on providing:

  • Expertise in SBA debt resolution
  • Effective negotiation
  • Successfully resolved SBA debts via OIC and Negotiated Repayment Agreements
  • A sense of relief during financially stressful times

Distinguished by well-educated attorneys and customer experience exceeding expectations, Protect Law Group stands out in its industry. It’s a reliable option for handling SBA debt problems, making it a valuable ally in managing difficult financial circumstances.

If you find yourself battling an SBA loan default, remember that you are not alone. Leverage the knowledge and assistance provided by experts in the field to protect your business and personal assets. Don’t let an SBA loan default hinder your business development. Reach out to Protect Law Group or a similar organization equipped to help you navigate and overcome this challenging situation.

Frequently Asked Questions

What constitutes an SBA loan default?

An SBA loan default occurs when a borrower fails to meet the repayment obligations outlined in their loan agreement, leading to potential legal and financial consequences.

What steps should I take if I default on my SBA loan?

It’s crucial to understand your default status and explore available options to resolve the situation. Consulting with legal professionals experienced in SBA debt issues can provide guidance on the best course of action.

How can Protect Law Group assist with SBA loan defaults?

Protect Law Group specializes in representing small business owners and federal debtors, offering services such as SBA Offer in Compromise, structured workouts, administrative litigation, and negotiations to help resolve SBA debt-related matters.

What is an SBA Offer in Compromise (OIC)?

An SBA OIC is a settlement agreement that allows a borrower to repay less than the full amount owed on their SBA loan, subject to approval based on the borrower’s financial situation.

What does a structured workout entail?

A structured workout is a customized repayment plan that extends the loan term or modifies payment schedules to make debt repayment more manageable for the borrower.

What is administrative litigation in the context of SBA loans?

Administrative litigation involves legal proceedings before the SBA Office of Hearings and Appeals, where borrowers can contest decisions or actions taken by the SBA regarding their loan.

How can negotiations help in resolving SBA loan defaults?

Through negotiations, borrowers and lenders can reach mutually agreeable terms to modify loan conditions, potentially avoiding more severe consequences like asset seizure.

What are cross-servicing disputes?

Cross-servicing disputes arise when multiple agencies are involved in debt collection, leading to complexities that require specialized legal assistance to navigate effectively.

What are the benefits of seeking professional help for SBA loan defaults?

Professional assistance provides expertise in navigating legal complexities, advocating for favorable terms, and ensuring compliance with all procedural requirements, thereby increasing the chances of a successful resolution.

How can I contact Protect Law Group for assistance?

You can reach out to Protect Law Group through their official website or contact information provided in the article to schedule a consultation and discuss your specific situation.

$1,500,000 SBA COVID-EIDL LOAN - SBA OHA LITIGATION

$1,500,000 SBA COVID-EIDL LOAN - SBA OHA LITIGATION

Small business and guarantors obtained an SBA COVID-EIDL loan for $1,000,000. Clients defaulted causing SBA to charge-off the loan, accelerate the balance and refer the debt to Treasury's Bureau of Fiscal Service for collection. Treasury added nearly $500,000 in collection fees totaling $1,500,000. Clients were served with the SBA's Official 60-Day Notice and exercised the Repayment option by applying for the SBA’s Hardship Accommodation Plan. However, their application was summarily rejected by the SBA without providing any meaningful reasons. Clients hired the Firm to represent them against the SBA, Treasury and a Private Collection Agency.  After securing government records through discovery, we filed an Appeals Petition with the SBA Office of Hearings & Appeals (OHA) court challenging the SBA's referral of the debt to Treasury. During litigation and before the OHA court issued a final Decision and Order, the Firm successfully negotiated a reinstatement and recall of the loan back to the SBA, a modification of the original repayment terms, termination of Treasury's enforced collection and removal of the statutory collection fees.

$298,000 SBA 7A LOAN - NEGOTIATED WORKOUT AGREEMENT

$298,000 SBA 7A LOAN - NEGOTIATED WORKOUT AGREEMENT

Clients obtained an SBA 7(a) loan for their small business in the amount of $298,000. They pledged their primary residence and personal guarantees as direct collateral for the loan. The business failed, the lender was paid the 7(a) guaranty money and the debt was assigned to the SBA.  Clients received the Official 60-Day Notice giving them a couple of options to resolve the debt balance directly with the SBA before referral to Treasury's Bureau of Fiscal Service. The risk of referral to Treasury would add nearly $95,000 to the SBA principal loan balance. With the default interest rate at 7.5%, the amount of money to pay toward interest was projected at $198,600. Clients hired the Firm with only 4 days left to respond to the 60-Day due process notice.  Because the clients were not eligible for an Offer in Compromise (OIC) due to the significant equity in their home and the SBA lien encumbering it, the Firm Attorneys proposed a Structured Workout to resolve the SBA debt.  After back and forth negotiations, the SBA Loan Specialist assigned to the case approved the Workout terms which prevented potential foreclosure of their home, but also saved the clients approximately $294,000 over the agreed-upon Workout term with a waiver of all contractual and statutory administrative fees, collection costs, penalties, and interest.

$337,000 SBA 504 LOAN - SBA OIC CASH SETTLEMENT

$337,000 SBA 504 LOAN - SBA OIC CASH SETTLEMENT

Clients personally guaranteed an SBA 504 loan balance of $337,000.  The Third Party Lender had obtained a Judgment against the clients.  We represented clients before the SBA and negotiated an SBA OIC that was accepted for $30,000.

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