(Distressed Loan Advisors are experts at SBA debt settlement, and can be reached at www.JasonTees.com)
Making the decision to close your business is not easy, but often
times, it is absolutely the correct thing to do. Once you make the
decision to close your business, the next inevitable question is: Now
what?

If you are closing your business, you should establish a plan. That
plan usually means working with your bank. Presumably, the SBA loan
you have is secured with the assets of your business. That can include
tables, chairs, ovens, sinks, etc. Before they will entertain talk of
settling your debt, your bank will first want to liquidate all the
collateral (the one exception could be your primary residence). You
need to contact your bank, explain to them that you have closed, and
you are willing to cooperate however you can. This will usually entail
the bank valuing the assets, and if they have value, they will sell
them and apply the funds to your loan balance.

Once the business is closed, and all the business assets have been
liquidated, you will then be eligible to submit an Offer In Compromise
(OIC) to the SBA. This is typically accomplished by submitting the OIC
through your lender. Your lender will review the OIC, then forward it
on to the SBA (Note: the SBA will want to know if you've been
cooperative, so play nice with your bank). It's important to keep in
mind that if your home is being held as collateral, your OIC offer will
need to at least cover the amount of equity in your home. If you don't
offer at least that, the SBA is likely to reject your offer.

If your offer is strong enough and the SBA approves it, once you pay
whay you agreed to pay to settle the debt, the SBA will release your
personal guaranty and any remaining liens on your home. Keep in mind
that if you are paying over time, these releases will only come once
you've paid the entire amount of the OIC.