SBA Loan Default: 6 Things You Should Know
Are you concerned with what to do in the event of an SBA loan default? Then read about some things you'll need to consider when defaulting on an SBA loan.
Learn more about SBA debt relief programs and how Protect Law Group can help with SBA repayment plan negotiations. Get in touch with us today.
Book a Consultation CallFacing overwhelming debts can be daunting for small business owners, but there is relief available through the Small Business Administration (SBA) repayment plans. In this blog post, we will explore the ins and outs of SBA repayment plans and how they can be beneficial for your business. If you are struggling with SBA debt, Protect Law Group is here to provide expert assistance. Contact us today for a case evaluation.
As a small business owner, you may find yourself burdened with substantial debt. The SBA debt relief program offers a lifeline by providing options to ease your financial strain. These programs aim to restructure your debts and make them more manageable, allowing you to regain control of your business.
Under this program, the SBA may offer relief by covering a portion of your loan repayments, reducing your interest rates, or extending the repayment period. This can significantly alleviate the burden of your debts and give you the breathing room you need to stabilize your business.
SBA repayment plans are designed to help you pay down your debts in a structured and feasible manner. These plans typically involve negotiations with the SBA or your lender to lower monthly payments or settle the debt for a reduced amount. With the experience of Protect Law Group's SBA attorneys, you can navigate these negotiations effectively, ensuring the best outcome for your business.
Opting for an SBA repayment plan offers several advantages. It allows you to avoid more severe consequences, such as bankruptcy or home foreclosure. Moreover, it provides a path towards regaining financial stability and preserving your business.
If SBA debt has become overwhelming for your small business, seek the expert guidance of Protect Law Group. Our attorneys understand the intricacies of SBA repayment plans and will work tirelessly to tailor a solution that suits your unique circumstances. Contact us today for a case evaluation and take the first step towards finding your path to business debt recovery.
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 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.
Clients personally guaranteed an SBA 504 loan balance of $337,000. The Third Party Lender had obtained a Judgment against the clients. We represented clients before the SBA and negotiated an SBA OIC that was accepted for $30,000.
Client’s small business obtained an SBA 7(a) loan for $150,000. He and his wife signed personal guarantees and pledged their home as collateral. The SBA loan went into default, the term or maturity date was accelerated and demand for payment of the entire amount claimed was made. The SBA lender’s note gave it the right to adjust the default interest rate from 7.25% to 18% per annum. The business filed for Chapter 11 bankruptcy but was dismissed after 3 years due to its inability to continue with payments under the plan. Clients wanted to file for Chapter 7 bankruptcy, which would have been a mistake as their home had significant equity to repay the SBA loan balance in full as the Trustee would likely seize and sell the home to repay the secured and unsecured creditors. However, the SBA lender opted to pursue the SBA 7(a) Guaranty and subsequently assigned the loan and the right to enforce collection to the SBA. Clients then received the SBA Official 60-Day Notice and hired the Firm to respond to it and negotiate on their behalf. Clients disputed the SBA’s alleged balance of $148,000, as several payments made to the SBA lender during the Chapter 11 reorganization were not accounted for. To challenge the SBA’s claimed debt balance, the Firm Attorneys initiated expedited discovery to obtain government records. SBA records disclosed the true amount owed was about $97,000. Moreover, because the Clients’ home had significant equity, they were not eligible for an Offer in Compromise or an immediate Release of Lien for Consideration, despite being incorrectly advised by non-attorney consulting companies that they were. Instead, our Firm Attorneys recommended a Workout of $97,000 spread over a lengthy term and a waiver of the applicable interest rate making the monthly payment affordable. After back and forth negotiations, SBA approved the Workout proposal, thereby saving the home from imminent foreclosure and reducing the Clients' liability by nearly $81,000 in incorrect principal balance, accrued interest, and statutory collection fees.
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