SBA Loan Default: You Pledged Your Personal Residence, Now What?
We will analyze your SBA loan problems and advise you on potential solutions such as an SBA offer in compromise for your SBA loan default.
Contact Our SBA Attorneys for Nationwide Representation for SBA and Treasury Debt Issues
Book a Consultation CallOne strategy you may have chosen to address your SBA debt was to file for bankruptcy. You received your discharge, which absolved you of any personal liability for the SBA debt under your personal guarantee but you pledged your home as additional collateral for the SBA guaranteed loan. Unfortunately, the bankruptcy did not eliminate the lien on your home.
Many times, SBA debtors are under the mistaken belief that the bankruptcy discharges the lien or maybe the SBA debtors were otherwise unaware of the SBA lien. Other situations where an SBA lien release for consideration may arise include the death of a spouse, who was the sole personal guarantor on an SBA guaranteed loan leaving the surviving spouse to try and resolve the SBA lien; or a divorce wherein the non-liable spouse not only inherits the home, but also the SBA lien that runs with it.
Under certain circumstances, you may have the opportunity to negotiate a release of the SBA lien for consideration. In other words, you can offer to buy out the SBA lien. Several factors may go into what the amount of consideration will be, but the most important factor will be how much “equity” in the home is covered by the SBA lien. The SBA and/or third-party lender will analyze the value of your home, the amount of any senior liens, and the likely recovery in a forced sale. Our SBA Attorneys possess the knowledge and experience to negotiate SBA lien releases for consideration in these scenarios.
Naturally, the SBA and/or the third-party lender will want to extract as much money as possible from you. It’s best to have experienced SBA Attorneys on your side to help protect your interests and try to prevent the SBA or the bank from taking advantage of you and foreclosing the SBA lien they hold against your home.
If you are faced with an SBA lien on your home, contact Protect Law Group today for a Case Evaluation.
Under certain circumstances, you may have the opportunity to negotiate a release of the SBA lien for consideration. In other words, you can offer to buy out the SBA lien. Several factors may go into what the amount of consideration will be, but the most important factor will be how much “equity” in the home is covered by the SBA lien. The SBA and/or third-party lender will analyze the value of your home, the amount of any senior liens, and the likely recovery in a forced sale. Our SBA Attorneys possess the knowledge and experience to negotiate SBA lien releases for consideration in these scenarios.
Naturally, the SBA and/or the third-party lender will want to extract as much money as possible from you. It’s best to have experienced SBA Attorneys on your side to help protect your interests and try to prevent the SBA or the bank from taking advantage of you and foreclosing the SBA lien they hold against your home.
If you are faced with an SBA lien on your home, contact Protect Law Group today for a Case Evaluation.
Small business sole proprietor obtained an SBA COVID-EIDL loan for $500,000. Client defaulted causing SBA to charge-off the loan, accelerate the balance and refer the debt to Treasury's Bureau of Fiscal Service for aggressive collection. Treasury added $180,000 in collection fees totaling $680,000+. Client tried to negotiate with Treasury but was only offered a 3-year or 10-year repayment plan. Client hired the Firm to represent before the SBA, Treasury and a Private Collection Agency. After securing government records through discovery and reviewing them, we filed an Appeals Petition with the SBA Office of Hearings & Appeals (OHA) court challenging the SBA's referral of the debt to Treasury citing a host of purported violations. The Firm was able to negotiate a reinstatement and recall of the loan back to the SBA, participation in the Hardship Accommodation Plan, termination of Treasury's enforced collection and removal of the statutory collection fees.
Clients borrowed and personally guaranteed an SBA 7(a) loan. Clients defaulted on the SBA loan and were sued in federal district court for breach of contract. The SBA lender demanded the Client pledge several personal real estate properties as collateral to reinstate and secure the defaulted SBA loan. We were subsequently hired to intervene and aggressively defend the lawsuit. After several months of litigation, our attorneys negotiated a reinstatement of the SBA loan and a structured workout that did not involve any liens against the Client's personal real estate holdings.
Clients personally guaranteed SBA 7(a) loan balance of over $300,000. Clients also pledged their homes as additional collateral. SBA OIC accepted $87,000 with the full lien release against the home.
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