Best Practices: The SBA Is Bringing False Claims Act Cases Against PPP Lenders
The amount of PPP loan fraud that has apparently occurred is astonishing. Government investigations have determined that the amount of fraudulent PPP loans is in the tens of billions of dollars, if not more. The government wants to get back the money that should never have been loaned in the first place. The government has ... Read More
Best Practices: SBA Requirements for Purchasing a Division of an Existing Business
SBA 7(a) loan proceeds may be used for a change of ownership. In many business acquisitions, the buyer purchases all of the seller’s assets. However, that is not always the case. There are times when a buyer agrees to purchase only a division or a segment of an existing business. This article examines when the ... Read More
Best Practices: New Proposed Rule Seeks to Remove the Requirement for an SBA Loan Authorization
On November 7, 2022 (Volume 87, No. 66963), the Federal Register contained a Notice of Proposed Rulemaking whereby the Small Business Administration (“SBA”) proposed to remove the requirement for an SBA Loan Authorization (“Authorization”) as a condition for closing a 7(a) or 504 loan. The goal of the SBA is to further streamline the lending ... Read More
Best Practices: Change in Restriction on Uses of Proceeds under the SBA Proposed Rule
On October 26, 2022 Volume 87, No. 206 of the Federal Register contained a Notice of Proposed Rulemaking on Affiliation and Lending Criteria for the SBA Business Loan Programs. The purpose of the proposed Rule is to streamline and modernize regulations on lending criteria and loan conditions for the 7(a) and 504 loan programs to ... Read More
Best Practices: How to Avoid Common SBA Loan Closing Pitfalls
In an effort to meet the “closing deadline” desired by the small business borrower, lenders may feel the need to rush the closing and overlook critical housekeeping steps. When implemented and adopted, these “steps” help to ensure that lenders’ SBA loan files are complete, accurate, and free from inconsistencies. When overlooked, file deficiencies arise which ... Read More
Best Practices: Updated Lender Servicing Responsibilities for PPP Loans
On October 5, 2022, the SBA released Procedural Notice 5000-835955 (Extension and Revision of SBA Guidance on Guaranty Purchases and Lender Servicing Responsibilities for PPP Loans) or the “Notice.” The Notice both extends and updates the guidance which was contained in SBA Procedural Notice 5000-812316, “SBA Guaranty Purchases and Lender Servicing Responsibilities for PPP Loans” ... Read More
