Small business owners have access to financing that is guaranteed. This funding option helps them to acquire everything they need to start their business. This may include acquiring a property, inventory, or machinery for their business. However, businesses that are prospering may face financial issues due to delinquent loan payments. A SBA Offer in Compromise could provide them with an opportunity to reduce the repercussions for these failures.
The business owner receives a SBA demand letter when they are in default on their loan. The damage letter may require them to pay the entire balance of their account. To avoid immediate foreclosure of the property used as collateral for the loan, the business owner needs to contact an attorney. They should provide the attorney with the letter and any correspondences received from their lender. The business owner must take quick action when they have a SBA loan default. If they don't, the lender can foreclose on the property and destroy their credit.
A SBA offer is a percentage of the total loan value. Since the loan is guaranteed by the Small Business Administration, the consumer may have some leverage. This guarantee ensures the lender that they will receive a portion of the loan. However, the consumer will be required to pay the remaining balance. By submitting a settlement offer, the business owner prevents the potential damage caused by foreclosure.
A SBA loan foreclosure indicates that the lender has started the seizure process. They will place the property up for auction once they have possession. They sell it to the highest bidder. Any balance that is left over requires the borrower to pay off. If an attorney can acquire a settlement offer, the borrower avoids these consequences completely.
Small businesses need help when they are facing foreclosure. Once they are at least ninety-days delinquent, their lender can take legal action to take their property. The foreclosure process can have a lasting effect on the business owner and their ability to continue to operate their business. Company owners who need assistance with a settlement offer or Tax Offset Program should contact an attorney now.
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 7(a) loan for $150,000. COVID-19 caused the business to fail, and the loan went into default with a balance of $133,000. Client initially hired a non-attorney consultant to negotiate an OIC. The SBA summarily rejected the ineligible OIC and the debt was referred to Treasury’sBureau of Fiscal Service for enforced collection in the debt amount of $195,000. We were hired to intervene and initiated discovery for SBA and Fiscal Service records. We were able to recall the case from Fiscal Service back to the SBA. We then negotiated a structured workout with favorable terms that saves the client approximately $198,000 over the agreed-upon workout term by waiving contractual and statutory administrative fees, collection costs, penalties, and interest.
The clients are personally guaranteed an SBA 7(a) loan. The SBA referred the debt to the Department of Treasury, which was seeking payment of $487,981 from our clients. We initially filed a Cross-Servicing Dispute, which was denied. As a result, we filed an Appeals Petition with the SBA Office of Hearings and Appeals asserting legal defenses and supporting evidence uncovered during the discovery and investigation phase of our services. Ultimately, the SBA settled the debt for $25,000 - saving our clients approximately $462,981.
Our firm successfully facilitated the SBA settlement of a COVID-19 Economic Injury Disaster Loan (EIDL) f borrower received an SBA disaster loan of $150,000, but due to the severe economic impact of the COVID-19 pandemic, the business was unable to recover.
Despite the borrower’s efforts to maintain operations, shutdowns and restrictions significantly reduced the customer base and revenue, making continued operations unsustainable. After a thorough business closure review, we negotiated with the SBA, securing a resolution where the borrower paid only $6,015 to release the collateral, with no further financial liability for the owner/officer.
This case demonstrates how businesses affected by the pandemic can navigate SBA loan settlements effectively. If your business is struggling with an SBA EIDL loan, we specialize in SBA Offer in Compromise (SBA OIC) solutions to help close outstanding debts while minimizing financial burden.
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