The rapidly evolving environment precipitated by the coronavirus will have a wide reaching adverse economic impact on many American small businesses, as more and more business are forced to close to comply with government declarations. Unfortunately, many are likely to suffer an adverse economic impact from the current crisis, and if the business was already in trouble, may default on their loans. On March 10, 2020, SBA published Information Notice 5000-20005 which discusses recent revisions to the Guaranty Purchase Tabs enacted to make processing of guaranty purchase submissions quicker, with fewer requests for additional documentation. Lenders must use the revised Guaranty Purchase Tabs beginning with all packages submitted on April 1, 2020, but can begin to use them sooner.
Some of the key revisions are as follows:
Lenders can obtain the updated Guaranty Purchase Tabs at https://www.sba.gov/document/sba-form–regular-7a-guaranty-purchase-package-tabs. It is highly recommended that even if lenders are not using the new Guaranty Purchase Tabs for its submissions prior to April 1st, that lenders submit the additional documents now required under the updated Guaranty Purchase Tabs to avoid the Guaranty Purchase Center coming back to request them from the lender. Remember, as stated on the bottom of the 1st page of the current and revised Guaranty Purchase Tabs, the “SBA has the right to request additional documentation other than the items listed on this Index, and the Lender must comply with SBA’s request.”
While preparing the updated Guaranty Purchase Tabs submission, lenders need to remember to contact the appropriate Servicing Center to request the loan be placed in liquidation status.
Other items to keep in mind while preparing the Guaranty Purchase Tab submission:
For more information regarding SBA Guaranty Purchases or if you need assistance with your Guaranty Purchase submission, contact the attorneys at Starfield & Smith, PC at 215-542-7070.
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