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.
We help people who need to avoid SBA loan default by educating them on SBA OIG investigations, teaching about SBA offer in compromise and about various SBA loan problems.
Book a Consultation CallDealing with the idea that you might be facing SBA loan default can be terrifying. The SBA attorneys in our office are skilled at helping clients understand all of the facets of their situations. If, for instance, you need to know what an SBA offer in compromise is, you can simply ask your lawyer. You should never face 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. We urge you to read about the services that we have available and to contact us if you believe that we can be of assistance to you right now.
On May 26, 2015, the SBA's Office of Inspector General (hereafter "SBA OIG") issued Evaluation Report 15-12, Improvement is Needed in SBA’s Separation Controls and Procedures. Their objective was to determine the effectiveness of the Small Business Administration’s (SBA) controls over separated personnel.
The SBA OIG found that existing separation controls were not effectively followed. These controls include deactivating network accounts within 24 hours of separation and collecting Federal property from separated personnel. Specifically, the SBA OIG's analysis of network accounts identified 73 active accounts which should have been deactivated when the personnel separated from SBA. A large number of these 73 accounts were not automatically deleted as those accounts had never been accessed. Additionally, two active network accounts were accessed after the personnel had separated from the Agency—which was identified as security incidents.
The SBA OIG also reviewed 57 employee separation checklists, which are used to document the termination of network access and collect Federal property from separated employees. However, the SBA OIG found that less than half of the forms—46 percent—were correctly completed, and 19 percent could not be found.
The SBA OIG also found multiple errors in the manner that contracting officer’s representatives (CORs) carried out contractor separations, and also noted that SBA did not have formal procedures on how to deactivate and terminate intern and volunteer accounts.
The SBA OIG made six recommendations to SBA. SBA fully agreed with five of the six recommendations, and partially agreed with the sixth recommendation. SBA agreed to reinforce the importance of completing the separation checklist. Additionally, SBA identified that it would start holding line-management responsible if the forms were not fully completed. SBA agreed to investigate the two security incidents and report these incidents to the US Computer Emergency Readiness Team. SBA agreed to a new recertification policy in which every account is reviewed and any account not accessed within the previous 60 days is disabled. SBA agreed to revise contracting guidance so that CORs follow the same separation guidance as other SBA personnel with separations documented in a separation checklist. Finally, SBA agreed to have interns and volunteer separation procedures documented in revised Personnel ID Verification card procedures.
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 executed several trust deeds pledging seven (7) real estate properties and unconditional personal guarantees for an SBA 7(a) loan from the participating lender. The clients' small business failed and eventually defaulted on repayment of the loan exposing all collateral pledged by the clients. The SBA subsequently acquired the loan balance from the lender, including the right to liquidate and collect all pledged collateral pursuant to the trust deed instruments.
The Firm was hired to negotiate separate release of lien proposals for all 7 real estate properties. In preparation for the work assignment, the Firm Attorneys initiated discovery to secure records from the SBA and Treasury's Bureau of Fiscal Service. After reviewing the records and understanding the interplay between the lender and the SBA, the attorneys then prepared, submitted and negotiated the release of lien (ROL) for each of the 7 real estate properties for consideration.
After submitting the proposals, the assigned SBA Loan Specialists approved each ROL package - significantly reducing the total SBA debt claimed.
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 an SBA 7(a) loan for $100,000 from the lender. The SBA loan went into early default in 2006 less than 12 months from disbursement. The SBA paid the 7(a) guaranty monies to the lender and subsequently acquired the deficiency balance of about $96,000, including the right to collect against the guarantor. However, the SBA sent the Official 60-Day Due Process Notice to the Client's defunct business address instead of his personal residence, which he never received. As a result, the debt was transferred to Treasury's Bureau of Fiscal Service where substantial collection fees were assessed, including accrued interest per the promissory note. Treasury eventually referred the debt to a Private Collection Agency (PCA) - Pioneer Credit Recovery, Inc. Pioneer sent a demand letter claiming a debt balance of almost $310,000 - a shocking 223% increase from the original loan amount assigned to the SBA. Client's social security disability benefits were seized through the Treasury Offset Program (TOP). Client hired the Firm to represent him as the debt continued to snowball despite seizure of his social security benefits and federal tax refunds as the involuntary payments were first applied to Treasury's collection fees, then to accrued interest with minimal allocation to the SBA principal balance.
We initially submitted a Cross-Servicing Dispute (CSD) challenging the referral of the debt to Treasury based on the defective notice sent to the defunct business address. Despite overwhelming evidence proving a violation of the Client's Due Process rights, the SBA still rejected the CSD. As a result, an Appeals Petition was filed with the SBA Office of Hearings & Appeals (OHA) Court challenging the SBA decision and its certification the debt was legally enforceable in the amount claimed. After several months of litigation before the SBA OHA Court, our Firm Attorney successfully negotiated an Offer in Compromise (OIC) Term Workout with the SBA Supervising Trial Attorney for $82,000 spread over a term of 74 months at a significantly reduced interest rate saving the Client an estimated $241,000 in Treasury collection fees, accrued interest (contract interest rate and Current Value of Funds Rate (CVFR)), and the PCA contingency fee.
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