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SBA Loan Default

Due to difficult economic situations, many businesses cannot afford to pay their SBA loans while maintaining profitability, causing loan defaults to happen at record levels.

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If your business is struggling, closed, or closing, managing your EIDL or PPP loan debt is vital to reducing your liabilities.

Very Important

When an SBA Loan Defaults

The original loan terms were generous, and some loans like PPP could be forgiven if specific criteria were met. If keeping the original terms is not possible, the loan defaults and is sent directly to the Bureau of Fiscal Services (BFS).

The terms at the BFS are not as generous as your original loan, so it makes strategic sense to protect the original terms if you can. If it does default, talking to an experienced professional will help you understand your rights and options.

Very Important

Options if Sent to the Bureau of Fiscal Services (BFS)

Once sent to the BFS, the government will aggressively attempt to collect the debt using traditional collection actions such as bank levies, wage garnishments, and liens. To stop this, you must demonstrate to the BFS that you lack the financial ability to full pay the balance. We can then help establish three paths:

  • Installment Agreement: Set up to full pay the balance over time.

  • Partial Pay Installment Agreement: Allows you to pay much less than the full amount owed.

  • Offer In Compromise: Settles the full amount of the loan owed for much less than the total.

⚠️ Critical Factor

CRITICAL ASSET & FRAUD WARNINGIf your SBA loan was secured with collateral, that collateral must be completely liquidated and its value paid toward the loan balance before the government will even consider an Offer in Compromise. Furthermore, the US Government is actively auditing pandemic loans. If there is any potential fraud in your file, you must carefully consider the best legal strategy to protect yourself.

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Take the first step toward resolving your tax burden with total confidentiality.