Hard Money Loans

Typically and in most instances the banks have only one plan. Foreclose, take possession and liquidate by auction. They have few options or alternatives. It is expensive as lawyers, auctioneers, advertising, insurance, storage, etc. must all be paid while liquidating, which of course reduces the net gain to the bank from the process.

We all know banks are not lending money. We also know that the few opportunities that may exist from borrowing are made much more difficult by the banks requiring better credit than ever, and many of you have suffered credit hits because of the current downturn, reduced revenues and increased overhead expenses. Thus, it is even harder to get a loan.

This is a very complicated issue with many contributing factors: Some of the issues are net worth, income, spousal income, protected retirement investments, family, basic overhead, secured debt, other assets, other business interests, medical issues, education, age, where you love, what the assets in your business are worth, structure of the offer, and previous income history to name a few. There are just as many more not listed as each case is unique and each case requires a unique evaluation and presentation. Each case requires its own special evaluation.

The banks have virtually shut down, especially commercial lending. They may as well hang an out of business sign on their door, but should probably ad the following; we are out of business because we do not believe in our economy at all. Why else would they refuse to lend?

I have been asked many times, what will the SBA actually do? Will they liquidate our home, people ask in disbelief? Will they really garnish my wages? Many do not believe these procedures will actually occur, but they will.

So, the small business owner cannot refinance his home or even sell it, cannot borrow again, and cannot do anything because the liens remain on himself and his home. Is this an Offer in Compromise program? No, it’s a retribution and punishment program.

Everyone gets so upset over bank law suits and judgments entered against him or her. I understand it is not a pleasant experience but it means you really owe the bank some money. Sure, it may hurt your credit score a bit, but chances are you are in need of a credit rehabilitation program anyway and the debt relief can be worked out later.

Lets review. As we know, the defaulted borrower of an SBA guaranteed loan must present his Offer in Compromise to his lending banker for review and ratification and then for him to send it over to the SBA for final consideration. If deemed acceptable and appropriate, it is then sent over to the SBA where it is decided with a response to the borrower being: yes, no, or a counter-offer is provided.