On the surface, the claim that “I 100% guaranty that I can settle your debt”, sounds pretty darn good. Especially when you are trying to decide who to hire to remedy your SBA loan default.
The only problem such a claim is that it’s basically impossible to back up. Unless that statement includes the qualifier. Something like “I 100% guaranty that I can settle your debt as long as you have unlimited funds with which to negotiate with”. But that kind of changes the meaning, doesn’t it?
So when a prospective customer asks if I offer any guarantees when it comes to SBA loan default, I tell them that I don’t. Why?
The settlement process involves a number of players. This includes me (the SBA workout specialist), you (the borrower), your banker, your banker’s boss, the SBA specialist, and the SBA specialist’s boss (or a committee).
With so many moving parts, it’s impossible to predict with 100% certainty how any party will react to a settlement offer. Beyond that, while in most situations the lender will be open to some sort of settlement. Whether the borrower can actually meet the terms of the lender is a completely different story. So, if in 95% of cases, I get the bank to make some sort of concession, but only 20% of my clients can meet all the terms of the bank, is my success rate 95%? I think not.
DLA Is Like Your CPA
Workout Specialists like Distressed Loan Advisors are similar to tax preparers. Why? Sure, they do taxes and we handle SBA loan default. The similarity is that clients want to judge us solely on results. The truth is that only a portion of our success depends on us. How so? Did you ever have a friend who got his taxes done, and they said something to the effect of “my tax guy is really good, he got me $1,000 back!”?
Here’s a little secret about your tax guy: he doesn’t know anything more than any other CPA, accountant, or tax franchise. All he did was plug your numbers into a tax software program. He answers some questions about you, and POOF, you get a refund. Just because he knows about tax preparation doesn’t change the facts of your situation.
The point that I’m making here is that regardless of how well someone knows a process the specifics of your situation matter. No amount of expansive knowledge or creativity can overcome every obstacle pertaining to SBA default.
But don’t misunderstand my point here
Don’t get me wrong, I am an expert at the SBA offer in compromise process, but whether your lender or the SBA is going to accept a settlement offer is partially dependent on YOU, the borrower. Yes, I can be creative in my proposal, and yes, I know from extensive settlement experience what the SBA is more likely to say yes to.
I also know that the success of a settlement offer is directly related to the borrower’s personal financial situation. If you make $1 Million per year and have no other debt, the chances of settling a $10,000 debt are poor. I just don’t have any tricks in my bag for such a situation. My value comes to light when I effectively demonstrate to your lender and the SBA that what you are offering truly is the most you can offer, and represents the best recovery for them.
Final Thought: My Promise
While I won’t get your hopes up by guaranteeing a settlement, here is what I can promise:
- I will explore every possible avenue and settlement option to rectify your SBA loan default. I’ll make you aware of these options so that you can make the most informed decision possible.
- I will not make promises of success just to get your business, or as a marketing tool. Sure, if I made broad guarantees I might get more clients. But, in the process I’d have many disappointments along the way. Work with me and you’ll get an honest assessment of your settlement prospects right up front.
- All of my actions will have your best interests in mind.
- I will be there to guide you through each and every step of the process.
- My fees are contingency based. This means that a large portion of my fee depends on my ability to get the job done for you.
Sorry, I actually have one more thing to say.
Why did I write this article? (updated)
I originally wrote this article a few years back. The genesis of the topic was that one of my competitors was touting their “guarantee”. There was lots of hyperbole, but little substance. And it annoyed me to no end. There is no way to guarantee an outcome when it comes to rectifying an SBA loan default. I know that. They know that too. It was nothing more than a marketing tool.
I’d come across these guys when I was a workout officer, and we soon came to view them as…how shall I out it? Ethically challenged? Or as one of my colleagues put it “every time I talk to those guys, I feel like I need to shower afterwards”.
So after I read about their totally amazingly amazing fantabulous guarantee, I had to say something.
Look, I fully appreciate the kind of pressure you are under. In times of stress and panic, it’s natural to gravitate towards the person or thing who promises to make it all go away. But during this crucial period, it’s also important to remember an ago old adage: if it seems too good to be true, it probably is.