How to Avoid an SBA Loan Default - Peer to Peer Lending
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.
The transcript of the video follows below for further review.
If you have defaulted on a Small Business Administration (SBA) loan and you are a federal employee, more than likely the Department of Treasury (DOT) will send you a notice stating that the DOT will offset your wages or salary, that is, take a portion of your paycheck every pay period until the debt is paid.
You can, however, appeal the wage garnishment or offset to the SBA’s Office of Hearing and Appeal (OHA). This course should not be pursued lightly and is not appropriate for a non-attorney or an inexperienced attorney in OHA cases.
The OHA assigns an administrative law judge (ALJ) to handle your appeal. The SBA will similarly assign an attorney to represent the SBA in the appeal. As stated, an OHA appeal amounts to a litigated case with provisions for motions, subpoenas, motions for summary judgment, etc. Moreover, if the law and provisions of the OHA appeal process are not followed, a petitioner may be subject to sanctions by the OHA. One should not be penny wise and pound foolish when it comes to appealing a federal salary offset or garnishment.
The OHA appeal of your federal salary garnishment or offset can, however, be an effective avenue to resolve your SBA loan default either by judicial decision or by settlement with the SBA. If you can prove that the debt does not exist or is not enforceable, you may secure relief from the debt and the wage garnishment or offset. A strong appeal may also convince the SBA that the debt should be settled rather than litigated in front of the OHA.
If you have defaulted on an SBA loan and are a federal employee, please contact Protect Law Group for a consultation at 1-888-756-9969 or visit our website at www.sba-attorneys.com.
Millions of Dollars in SBA Debts Resolved via Offer in Compromise and Negotiated Repayment Agreements without our Clients filing for Bankruptcy or Facing Home Foreclosure
Millions of Dollars in Treasury Debts Defended Against via AWG Hearings, Treasury Offset Program Resolution, Cross-servicing Disputes, Private Collection Agency Representation, Compromise Offers and Negotiated Repayment Agreements
Our Attorneys are Authorized by the Agency Practice Act to Represent Federal Debtors Nationwide before the SBA, The SBA Office of Hearings and Appeals, the Treasury Department, and the Bureau of Fiscal Service.
Client personally guaranteed SBA 7(a) loan for $150,000. COVID-19 caused the business to fail, and the loan went into default with a balance of $133,000. Client initially hired a non-attorney consultant to negotiate an OIC. The SBA summarily rejected the ineligible OIC and the debt was referred to Treasury’s ureau of Fiscal Service for enforced collection in the debt amount of $195,000. We were hired to intervene and initiated discovery for SBA and Fiscal Service records. We were able to recall the case from Fiscal Service back to the SBA. We then negotiated a structured workout with favorable terms that saves the client approximately $198,000 over the agreed-upon workout term by waiving contractual and statutory administrative fees, collection costs, penalties, and interest.
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.
Clients' 7(a) loan was referred to Treasury's Bureau of Fiscal Service for enforced collection in 2015. They not only personally guaranteed the loan, but also pledged their primary residence as additional collateral. One of the clients filed for Chapter 7 bankruptcy thinking that it would discharge the SBA 7(a) lien encumbering their home. They later discovered that they were mistakenly advised. The Firm was subsequently hired to review their case and defend against a series of collection actions. Eventually, we were able to negotiate a structured workout for $180,000 directly with the SBA, saving them approximately $250,000 (by reducing the default interest rate and removing Treasury's substantial collection fees) and from possible foreclosure.
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