What Can I Do If I Receive a Denial of a PPP Loan Application?
If your lender denied a PPP loan application you have rights to review and appeal. Our experienced SBA attorneys can guide you through the process.
Learn about different bankruptcy options for small business owners. Contact Protect Law Group serving San Diego, Orange, and Los Angeles Counties.
Book a Consultation CallFor small business owners facing overwhelming debt burdens, bankruptcy can be a viable option for gaining financial relief and a fresh start. However, when it comes to dealing with Small Business Administration (SBA) debt, understanding the bankruptcy options available is crucial. In this blog post, Protect Law Group will explore the various bankruptcy options specifically tailored for small business owners with SBA debts.
Chapter 7 bankruptcy, also known as liquidation bankruptcy, is a common option for small business owners looking to eliminate their SBA debts. Through this process, the business's assets are liquidated, and the proceeds will be used to pay off creditors, including the SBA. Once the debts are discharged, the business owner can start anew without the burden of SBA obligations.
For small business owners who wish to continue operating their businesses while seeking debt relief, Chapter 11 bankruptcy may be the right option. This type of bankruptcy allows for the restructuring of debts, including SBA loans, by developing a repayment plan that is manageable for the business. The plan typically extends the repayment period and may involve negotiating reduced interest rates or lower monthly payments.
In some cases, small business owners may be able to negotiate loan workouts or settlements directly with the SBA. This involves discussing revised repayment terms or exploring the possibility of settling the debt for a reduced amount. Working with an experienced bankruptcy attorney during these negotiations can greatly increase the chances of securing favorable terms.
The SBA offers an option called an Offer in Compromise (OIC), which allows small business owners to settle their SBA debts for less than the amount owed. This option is typically available if the business demonstrates an inability to repay the debt in full and can provide supporting financial documentation. While an OIC can be a viable solution, it's important to note that the decision lies with the SBA.
For small business owners struggling with SBA debts, exploring bankruptcy options can provide a path to financial recovery. Book a consultation call with one of Protect Law Group’s SBA loan attorneys serving San Diego, Orange, and Los Angeles Counties today!
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.
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.
Client received the SBA's Official 60-Day Notice for a loan that was obtained by her small business in 2001. The SBA loan went into default in 2004 but after hearing nothing from the SBA lender or the SBA for 20 years, out of the blue, she received the SBA's collection due process notice which provided her with only one of four options: (1) repay the entire accelerated balance immediately; (2) negotiate a repayment arrangement; (3) challenge the legal enforceability of the debt with evidence; or (4) request an OHA hearing before a U.S. Administrative Law Judge.
Client hired the Firm to represent her with only 13 days left before the expiration deadline to respond to the SBA's Official 60-Day Notice. The Firm attorneys immediately researched the SBA's Official loan database to obtain information regarding the 7(a) loan. Thereafter, the Firm attorneys conducted legal research and asserted certain affirmative defenses challenging the legal enforceability of the debt. A written response was timely filed to the 60-Day Notice with the SBA subsequently agreeing with the client's affirmative defenses and legal arguments. As a result, the SBA rendered a decision immediately terminating collection of the debt against the client's alleged personal guarantee liability saving her $50,000.
Our firm successfully resolved an SBA 7(a) loan default in the amount of $212,000 on behalf of an individual guarantor. The borrower’s business experienced a significant downturn in revenue and was unable to sustain operations, ultimately leading to closure and a remaining personal guaranty obligation.
After conducting a thorough financial review and preparing a comprehensive SBA Offer in Compromise (SBA OIC) submission, we negotiated directly with the SBA and lender to achieve a settlement of $50,000—approximately 24% of the outstanding balance. This favorable resolution released the guarantor from further personal liability and provided the opportunity to move forward free from the burden of enforced collection.
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