Everything You Need to Know About SBA Loan Collateral and Personal Bankruptcy
Did you know that personal bankruptcy doesn't always mean you can walk away from your SBA loan? Here's what you need to know about SBA loan collateral.
We provide people who are facing an SBA loan default with solutions. We analyze SBA loan problems and provide solutions such as an SBA offer in compromise.
Book a Consultation CallDealing with the idea that you might be facing an SBA loan default can be terrifying. The SBA attorneys in our office are skilled at helping clients understand all the facets of their situation. We will advise you as to the potential for an SBA offer in compromise. You should never face your SBA loan problems alone. It is important to retain the services of an attorney who can help you through this difficult time in your life. Please contact us for a consultation.
You signed a personal guarantee for an SBA loan, either a limited or unlimited guarantee. You've had a falling out with your business partners and you want out of the guarantee. Do you have any options?
Yes, you can be released from the guarantee or substitute in another guarantor with the following considerations:
(1) The status of the loan. It should be current in all respects without a history of unjustified delinquencies, unpaid taxes, or deferment of installments.
(2) Written requests. The field office must have a written request from the borrower, the guarantor to be released, or the proposed substitute.
(3) Consent of other parties. The written consent of all parties (e.g., other guarantors, standby creditors, etc.) must be obtained before the transaction is finalized.
(4) Opinion of counsel. You must obtain the opinion of SBA counsel showing that no legal rights of the Agency will be adversely affected.
(5) Sale or reorganization. Where a request is received for the release of a guarantor because of reorganization or sale of the firm, you must provide full information as to the terms and conditions of the proposed transaction. The SBA must take care to ensure that the guarantor's position is not improved at the expense of SBA, or that a possible loss to the guarantor is not passed on to the Agency. The guarantor should not be permitted to substitute SBA for his or her ownership position
(6) Evaluation of substitute guarantors. Before the SBA can recommend accepting a substitute guarantor in place of the original, the SBA will analyze/compare the values of the guarantors. The borrower must furnish personal financial statements and any other information satisfactory to the approving official.
If you can make it through the SBA gauntlet it is possible to be released from your guarantee. If you are facing this or other SBA loan problems, please contact us at 888-756-9969 for a consultation.
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 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.
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 an SBA 7(a) loan to help with a relative’s new business venture. After the business failed, Treasury was able to secure a recurring Treasury Offset Program (TOP) levy against our client’s monthly Social Security Benefits based on the claim that he owed over $1.2 million dollars. We initially submitted a Cross-Servicing Dispute, but then, prepared and filed an Appeals Petition with the SBA Office of Hearings and Appeals (SBA OHA). As a result of our efforts, we were able to convince the SBA to not only terminate the claimed debt of $1.2 million dollars against our client (without him having to file bankruptcy), but also refund the past recurring amounts that were offset from his Social Security Benefits in connection with the TOP levy.
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