Discover key factors regarding business loan repayment obligations after a business failure. Explore SBA loan forgiveness options and consult with Protect Law Group.
Book a Consultation CallHere at Protect Law Group, we have the privilege of serving clients all over the country. We understand the financial challenges that businesses may encounter, particularly when it comes to securing business loans. As a result, one common question that often arises is, "Can a Business Loan be Forgiven if the Business Fails?" In this blog post, we will delve into this important issue and discuss key considerations, including SBA loan forgiveness options. We aim to provide you with the necessary information to make informed decisions for your business's financial future. Read on to learn more!
Business loans are crucial for many entrepreneurs and small business owners to start, grow, or sustain their operations. However, economic downturns, unforeseen circumstances, or other factors can sometimes lead to business failure. In such instances, the question of loan repayment becomes pertinent.
When a business closes its doors, business owners need to understand that the debts incurred, such as business loans, do not simply vanish. Unfortunately, as a business owner, you may be personally liable for any loans that you have guaranteed. This means that even if your business is no longer operating, you may still be obligated to repay these loans if your business structure allows for a personal guarantee. It is crucial to have a thorough understanding of the financial responsibilities that come with owning a business, as it can have a significant impact on your finances in the event of closure.
The Small Business Administration (SBA) offers loan forgiveness programs for certain types of loans, providing a reduction of the debt obligation to eligible borrowers facing financial hardship. SBA forgiveness loan options can assist in alleviating the burden of repayment in specific circumstances. Our team can guide you through the process of applying for SBA loan forgiveness and help determine if you qualify for these programs.
At Protect Law Group, we specialize in assisting businesses and individuals with legal matters related to business loans, including SBA forgiveness. If you are grappling with a failed business and uncertain loan repayment obligations, we are here to provide expert guidance and personalized solutions tailored to your situation.
Our experienced attorneys are well-versed in navigating complex financial issues, including debt resolution, negotiating settlements, and exploring legal options to protect your interests. We will work closely with you to understand the specifics of your case and develop a strategic plan to address your concerns effectively.
Navigating the aftermath of a failed business can be overwhelming, but you don't have to face it alone. Our team at Protect Law Group is dedicated to helping you find clarity and peace of mind in uncertain times. Contact us today to schedule a consultation and take the first step toward resolving your business loan challenges.
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.
Our firm successfully negotiated an SBA offer in compromise (SBA OIC), settling a $974,535.93 SBA loan balance for just $18,000. The offerors, personal guarantors on an SBA 7(a) loan, originally obtained financing to purchase a commercial building in Lancaster, California.
The borrower filed for bankruptcy, and the third-party lender (TPL) foreclosed on the property. Despite the loan default, the SBA pursued the offerors for repayment. Given their limited income, lack of significant assets, and approaching retirement, we presented a strong case demonstrating their financial hardship.
Through strategic negotiations, we secured a favorable SBA settlement, reducing the nearly $1 million debt to a fraction of the amount owed. This outcome allowed the offerors to resolve their liability without prolonged financial strain.
Clients personally guaranteed an SBA 7(a) loan that was referred to the Department of Treasury for collection. Treasury claimed our clients owed over $220,000 once it added its statutory collection fees and interest. We were able to negotiate a significant reduction of the total claimed amount from $220,000 to $119,000, saving the clients over $100,000 by arguing for a waiver of the statutory 28%-30% administrative fees and costs.
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’sBureau 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.
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