Dealing with SBA Loan Problems? We’re Here to Help!
For years the Small Business Administration (SBA) has supported small businesses by offering loans with good terms. These loans are meant to help businesses recover from tough times and economic struggles. During the COVID-19 crisis, the SBA provided various loan options, like PPP and EIDL, to help businesses. Now, many businesses are having a hard time keeping up with these loans due to ongoing economic challenges, leading to a lot of defaults.
Your Options Explained
SBA loans originally came with benefits like low interest rates and long repayment periods—up to 30 years. PPP loans could even be forgiven under certain rules. However, if you’re struggling to keep up with payments, here’s what you can do:
- Keep the Loan: If possible, continue making payments and keep the original loan benefits.
- Handle Defaults: If you can’t make payments and your loan defaults, it will be handed over to the Bureau of Fiscal Services (BFS) for collection. They might take steps like taking money directly from your bank, your wages, or putting liens on your property.
Options for Defaulted Loans with BFS
If BFS is managing your defaulted loan, there are still ways to handle it:
- Installment Agreement: Arrange to pay the full balance over time, though the terms might not be as good as your original loan.
- Partial Pay Installment Agreement: You can pay less than the total amount if you show that you can’t afford the full payments.
- Offer in Compromise: Settle your debt for less than the total amount owed, depending on your financial situation. If accepted, you’ll need to report this to the IRS.
Watch Out for Audits
The government is closely checking these loans for any signs of fraud. If there’s an issue with fraud in your loan, it’s important to think carefully about the best way forward.
Talk to a Tax Expert
Handling SBA loan issues can be tricky. Whether your business is at risk of closing or you just want to reduce your debt, talking to one of our experienced tax professionals can help you figure out the best approach. Contact us at The Tax Defense Group to discuss your options and start solving these problems today.
Legal Disclaimer: This content is for general information only and is not legal or financial advice. Always speak to a qualified professional for specific advice on your situation.