Hello everyone, I’m Jason, the founder of Distressed Loan Advisors, and I’ve been assisting individuals facing challenging situations with SBA loans since 2009. If you’d like to schedule a case evaluation, simply click here.
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Now, let’s delve into an important update. Today, the Washington Post released an article highlighting an ongoing dispute between the SBA and the Inspector General. I previously covered this in a video, addressing the disagreement regarding the referral of SBA-EIDL loans under $100,000 to the Treasury for collection.
Initially, the SBA claimed they had no intention of referring these smaller loans to the Treasury, citing a perceived lack of significant recovery potential. I tend to agree with this standpoint, as loans under $100,000, for the most part, lack personal guarantees. Consequently, the tools available to the Treasury and SBA for collecting from individual businesses in such cases are limited.
Following a period of review, the SBA has reversed its stance, as reported by the Washington Post. They now plan to send all loans, even those under $100,000, to the Treasury for collection.
So, how does this affect you?
If you borrowed under a legal entity for amounts $100,000 or less, not much changes, as personal guarantees weren’t taken for these loans. The significant impact is on individuals named personally as borrowers, particularly sole proprietors doing business without a separate corporate entity. For loans in your name, personally, it adds a layer of complexity.
If you borrowed through a legal entity or owe $100,000 or less, the impact is minimal. The primary concern lies with those personally named as the borrower in the loan documents, a situation common for those without a separate corporate entity.
For any questions or concerns, schedule some time with me here.
