Chapter 11 Subchapter V Bankruptcy: Explained in Plain English
Chapter 11 Subchapter V has redefined the process of small business bankruptcies. Learn what's changed (and how Protect Law Group can help) in this guide.
Defaulted SBA Loan Offer in Compromise? Answers to questions by borrowers in SBA default considering submitting a fully compliant Offer in Compromise.
Book a Free Consultation CallThe Small Business Administration provides loans for entrepreneurs to start smaller business ventures. These loans are guaranteed by the government and require the business owner to pay them back according to the schedule set up. When the business owner faces financial difficulties, they may not have the funds needed to repay the loan. This could result in a default. When this happens, an SBA Loan Offer in Compromise could prevent the company from facing financial ruin.
Essentially, the offer in compromise is a settlement offer submitted by a financial advisor or attorney. It reflects are reduced value in which the business owner could pay their lender to settle the debt. An SBA loan default requires action on the borrower's part to avoid unwanted circumstances. This compromise is an effective strategy to prevent these circumstances and prevent a larger financial loss for the owner.
The owner should utilize an offer in compromise as soon as they receive the SBA demand letter. This letter is the last step of the notification process before the SBA takes further legal action. These actions could include seizure of property and assets. They could place a lien against the borrower's checking account, savings account, and all property in their name. These measures are taken to acquire payment of the total balance plus any late fees that accumulated.
Through an SBA loan foreclosure, the lender could seize the borrower's primary residence. This could occur if the property is used as collateral or included in the properties owned by the business. If properties and assets that are business-related could be used to pay off the loan, the primary residence isn't in jeopardy. However, the consumer may need an attorney to fight against these actions.
Small business owners must take quick action if their loan defaults. These actions could lead to a domino effect in which they lose all their property and assets. An attorney could help them by finding a better solution to this problem. Business owners who need assistance with a compromise or Tax Offset Program should contact an attorney immediately.
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 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.
Clients personally guaranteed SBA 504 loan balance of $750,000. Clients also pledged the business’s equipment/inventory and their home as additional collateral. Clients had agreed to a voluntary sale of their home to pay down the balance. We intervened and rejected the proposed home sale. Instead, we negotiated an acceptable term repayment agreement and release of lien on the home.
Client personally guaranteed SBA 504 loan balance of $375,000. Debt had been cross-referred to Treasury at the time we got involved with the case. We successfully had debt recalled to the SBA where we then presented an SBA OIC that was accepted for $58,000.
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