Contact Protect Law Group today at (888) 756-9969 or at and schedule your consultation with an SBA workout attorney. If your defaulted SBA loan has been charged off you will still need an experienced attorney to help negotiate a settlement. ![]() b) Estimated costs of future collection exceed any anticipated recovery c) Obligor cannot be located or is judgment proof d) The Lender/SBA's rights have expired (e.g., statute of limitations, restrictions of State law, Agency policy) e) Debt is legally without merit f) Adjudication of a Chapter 7 Bankruptcy as a no asset case, or completion of Chap 11/13 case g) The inability of the Lender to effect further worthwhile recovery. The determination to justify a charge off may be based on one or more of the following: a) The third party lender has exhausted all efforts in cost-effective recovery from: Voluntary payments from the borrower Liquidation of collateral Compromise with obligor leaving only a deficiency balance and Consideration has been given to any legal remedies available so that no further reasonable expectation of recovery remains. A charge off is justified when the third party lender has complied with all requirements of collection and liquidation and further collection of any substantial portion of the debt is doubtful. It should be noted that a charge off is merely an administrative determination that does NOT affect SBA's rights against any obligor nor reduce the SBA's (or a participant lender's) ability to proceed with any available remedy. The SBA's policy is to be diligent and thorough in collection of debt and to promptly charge off all uncollectible accounts to more accurately reflect the status of the individual account and the Agency's entire portfolio. ![]() ![]() “Charge off” is the process by which SBA recognizes a loss and removes the uncollectible loan account from its active receivable accounts. What is SBA's Policy Regarding Charge Off Accounts? Many times people think that because their defaulted SBA loan has been “charged off” they are not longer liable to the SBA. The transcript of the video follows below for further review.
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