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SBA Loan Default - The 60 Day Letter

Dealing with an SBA OIC case is hard. Allow one of our lawyers to settle SBA debt on your behalf. Talk to us about your SBA loan default situation.

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SBA Loan Default - The 60 Day Letter

You should not have to struggle to settle your SBA debt on your own. Instead, turn to one of our attorneys who specializes in SBA OIC claims. We are dedicated to helping you settle your SBA loan default.

If you are in default on your SBA loan, you will get what is termed a "60 day letter".  The following information should be included in a Federal agency's written communication with a debtor at least 60-days prior to referring a delinquent debt to the U.S. Department of the Treasury's Financial Management Service for debt collection (cross-servicing).  The information may be included in one letter or a series of letters.  The letter should include the following:

  • Nature and amount of the debt, including the basis for the debt.
  • Explanation of how interest, penalties, and administrative costs are added to the debt.
  • Date by which payment should be made to avoid late charges and enforced collection (generally, 30 days from the date the demand letter is mailed).
  • Name, address, and phone number of a contact person or office within the creditor agency.

Explain the agency's intent to enforce collection if debtor fails to pay by taking one or more of the following actions:

  • Offset the debtor's Federal payments, including income tax refunds, salary, certain benefit payments (such as Social Security), retirement, vendor, and travel reimbursements and advances.
  • Refer the debt to a private collection agency.
  • Report the debt to a credit bureau.
  • Garnish the debtor's wages through administrative wage garnishment (no court order required).
  • Refer the debt to the Department of Justice for litigation (comply with Executive Order 12988).
  • Refer the debt to the U.S. Department of the Treasury for any of the above-described collection actions (advise debtor that agencies are required to refer when debt is 180 days delinquent).

Explain how debtor exercises the opportunity to:

  • Inspect and copy agency's records related to the debt.
  • Request a review of agency's determination of the debt.
  • If applicable, request a waiver.
  • For purposes of salary offset or administrative wage garnishment, request a hearing.Enter into a reasonable written repayment agreement.

Advise the debtor of the following:

  • Notify agency if bankruptcy filed.
  • Penalties for knowingly making false or frivolous statements.
  • Excess collections will be refunded to the debtor, unless prohibited by law.
  • For Federal salary offset, up to 15% of current net disposable pay may be deducted every pay period until the debt is paid.
  • For joint income tax filers, spouse should file Form 8379 with the IRS to claim his/her share of tax refund.

The failure to include the above information may violate your rights and provide a basis for relief.  If you are struggling with circumstances that involve SBA loan default, you deserve professional aid! Our attorneys all know how to win SBA OIC cases.  Contact us and we will help you settle SBA debt once and for all.  After you schedule an appointment, you will consult with a devoted SBA OIC lawyer who will help you through your legal battle.  After your debt problem is resolved, you will never again have to worry about your SBA loan default problem haunting you.  Our team of lawyers has assisted many clients through the years settle SBA debt, stop administrative wage garnishment and tax offset.  Now it is your turn! You truly can settle SBA debt for good!

Why Hire Us to Help You with Your Treasury or SBA Debt Problems?

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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

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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

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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 $350,000. The small business failed but because of the personal guarantee liability, the client continued to pay the monthly principal & interest out-of-pocket draining his savings. Client hired a local attorney but quickly realized that he was not familiar with SBA-backed loans or their standard operating procedures. Our firm was subsequently hired after the client received the SBA's official 60-day notice. After back-and-forth negotiations, we were able to convince the SBA to reinstate the loan, retract the acceleration of the outstanding balance, modify the original terms, and approve a structured workout reducing the interest rate from 7.75% to 0% and extending the maturity date for a longer period to make the monthly payments affordable. In conclusion, not only we were able to help the client avoid litigation and bankruptcy, but we also save him approximately $227,945 over the term of the workout.



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.



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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