HomeSBA Offers In Compromise (OIC)

SBA Offers In Compromise (OIC)

We Reduce Business Debt

Lawscape is dedicated to helping business owners successfully resolve their business debt without headaches, or long term consequences.

We Provide Nationwide Business Debt Relief

Lawscape provides nationwide business debt relief services. We work a wide array of lenders, service providers, and types of business debt. We are able to restructure and reduce, all types of secured and unsecured business debt. 


Millions of Dollars in Debts

Our team has experience handling 10’s of millions in debt, ranging from SBA debt, to Merchant Cash Advance and more. 


All Types Of Debt

Regardless of the type of business debt you have, we can help. We have experience handling all types of secured and unsecured business debt. 


Nationwide

Our company is led by experienced business debt relief experts who have experience handling secured and unsecured debt nationwide. 

Failing To Repay Business Debt Isn’t The End

Many business owners think failing to repay business debt means: your business is over.

This simply isn’t true. Business debt is a problem which CAN be handled, just like everything else; but only if you take pro-active steps. Lawscape helps you understand the law, and works with you to make sure that business debt isn’t the end of your business. 

What Are Some Ways We Can Help With Business Debt Relief?

Our experienced business debt relief consultants are here to help you through this stressful time. 

Bouncing Back with SBA Offers in Compromise (OIC) – A Guide

Alright, let’s have a heart-to-heart here. Small business life is both intense and rewarding, wouldn’t you agree? You come up with this killer idea, you nurture it, speak about it and sweat over it – but sadly, the odds can be rather harsh. Did you know approximately 20% of businesses capsize in their first year, and by five years in, a whopping 50% have bit the dust? Sounds nerve-wracking, doesn’t it?

The Silver Lining – SBA

The Lawscape has seen countless journeys of small businesses, including yours, that simply wouldn’t have been possible without a financial leg-up from the Small Business Administration (SBA). However, keeping your business accounts in check can often be similar to herding cats, if not tougher!

Speaking of finances, have you heard the term ‘offer in compromise’ thrown around lately? If your business is sinking under the weight of an SBA loan default, these three words could be your life raft. Stick around to find out more about SBA offers in compromise.

The nitty-gritty of SBA’s Offer in Compromise

The SBA isn’t blind to the odds stacked against most small businesses. They’ve seen it all – the hardships, the defaults on loans, and unfortunately, the inevitable business failures. Consequently, the SBA has developed an OIC program to throw a lifeline to business owners who have personally guaranteed their loans.

Loan Guarantees and Personal Responsibility

Remember when you took out that SBA-backed loan? Your business received the funds but you put your personal assets on the line as a guarantor. With your business in the doldrums, you’re now on the hook for the loan balance.

The OIC program lets you rework your loan terms with your lender. But be clear on this – it’s a compromise, not complete forgiveness. You’ll need to square off a portion of your debt even after selling your assets.

Without sounding too preachy, if you’re on the brink of closing your business, consider partnering with a legal expert, like the Lawscape, who can guide you through OIC settlements.

Penciling down the details about OIC

An OIC settlement can be your saving grace if your business is defaulting on an SBA loan. However, it’s not a given and there are certain elements you should be familiar with:

Reality Check: Business Closure

You may secretly wish to strike an OIC deal with the SBA while keeping your business afloat. But unfortunately, such approval scenarios are about as rare as a blue moon. Frankly, until your business is closed, the SBA won’t entertain settlement negotiations or consider loan forgiveness.

Asset Liquidation is Inevitable

Facing the hard truth, you’ll have to liquidate your assets. Often, the returns from the sale come up short compared to what you owe on your loan. It might seem appealing to ramp up sales when you see the end is near, but think again. Your liquidation strategy should be legally sound, transparent and be prioritized towards debt settlement.

You could seek a buyer, let your bank find one, consider a general auction or opt for supervised liquidation of individual assets.

Taking Home Equity into Account

While some states prohibit using homes as collateral for SBA loans, the rule doesn’t apply everywhere. If your home was used as collateral, your home equity will come into play. The SBA won’t entertain a settlement if your equity can cover your debt.

Forgo Expectations of Total Loan Forgiveness

Your small business finances could be precarious and a 100% forgiveness on your SBA 7(a) loan may seem like a golden ticket. Sorry to burst your bubble, but that’s not going to happen. Brace yourself from the get-go to avoid any unexpected disappointments.

Work Closely with Your Lender

Being on non-speaking terms with your lender helps nobody – not them, nor you! The way forward is through open, honest dialogue. The more you work closely with them, the better your chances of hammering out a favorable deal.

Applying for the OIC Application in Good Faith

Apply for an OIC as an individual, not as a business entity. Be thorough, impeccably accurate and brutally honest – about your income, other assets and savings – in all stages of the application process. Remember, a lowball offer is not your best strategy, being reasonable is.

Be Ready for the 1099 Form

As a sole proprietor, anticipate a 1099 form. It’ll be sent by your lender upon settlement, and the IRS will view it as income. For such tricky situations, never underestimate the importance of having knowledgeable attorneys, like those at Lawscape, by your side.

Lump Sum Settlements Are Favored

The SBA is more likely to look upon your application favorably if you can offer a lump-sum settlement over a payment plan.

Biding Your Time

Getting an OIC approved might take longer than you fancy. But if it comes through, honour your agreement to the letter. If you receive a rejection, don’t lose heart. You could always reapply with a revised offer after consulting your lender.

Managing Business Finances and OIC

The prospect of a failed business and the impending financial obligations can be daunting. The SBA OIC program is a beacon of hope in such testing times, allowing you to exit the business scene gracefully.

If you’d like some advice on dealing with an OIC application, reach out to us. The Lawscape is here to stand with you, every step of the way.

Lawscape Can Help You Manage Your Business Debt

If you’re struggling with business debt, we can help you understand your situation. During the initial consultation, we’ll go over the contract, and other legal documents you signed. After that, our firm will work with you to get a better understanding of your situation, and help you come up with a game plan that keeps your business alive. 

We Handle It All

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Merchant Cash Advance

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SBA Debt Relief

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Secured Business Debt

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Unsecured Business Debt

Everyone has different types of business debt. What matters is that you take it seriously. Regardless of whether it’s secured, or unsecured, you need to work with a firm that understands how to negotiate, reduce, settle, and manage, this business debt. 

Discuss your situation today

We are here to help you, and want nothing more than to help you save your business. Speak to our business debt relief specialists today.



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