Best Practices: SOP 50 10 7.1- Three Key Takeaways
https://starfieldsmith.com/wp-content/uploads/2023/10/1.f2792524-5077-4233-8a2d-0ef08665f5c4.mp3 Yesterday the U.S. Small Business Administration (“SBA”) released Standard Operating Procedure 50 10 7.1 (the “SOP”). The SOP was issued in lieu of the announced but unissued Technical Update to the prior SOP that became effective on August 1, 2023. Although we will be digesting all of the changes in the SOP in the ... Read More
Best Practices: Exploring SOP 50 57 3: Servicing Requests
https://starfieldsmith.com/wp-content/uploads/2023/10/101723.ed38cb07-9856-4e59-90c4-e8534f7cdc3c.mp3 After an SBA loan has been disbursed, a Borrower may request a loan action which may require a lender to submit a servicing request to the SBA. Such servicing requests can be very simple requests to update a mailing address to more complicated requests such as loan assumptions, substitution or release of collateral or ... Read More
Best Practices: Exploring SOP 50 57 3: Delinquent Secured Senior Loans
https://starfieldsmith.com/wp-content/uploads/2023/10/October10.56b46f77-6191-4d37-ab7a-9be1f47bcd34.mp3 SBA loans secured by junior liens on collateral are subject to the rights of senior lienholders in such collateral. SBA requires lenders to take prudent and commercially reasonable actions to ensure that the SBA lender’s junior lien is not eliminated in a foreclosure action initiated by the senior lienholder or that the equity available ... Read More
Best Practices: Handling SBA Loan Deferments
https://starfieldsmith.com/wp-content/uploads/2023/10/1be63ef0-b849-4fe9-8663-b379efc2cb0a.mp3 A deferment is a way by which a lender can temporarily reduce monthly payment amounts or completely suspend said payments for a brief period of time. When used correctly, a deferment can assist the borrower with cash flow improvement so that it can resume its normal monthly payments to the bank upon expiration of ... Read More
Best Practices: Exploring the revisions to SOP 50 57 (3): Liquidation of Collateral
https://starfieldsmith.com/wp-content/uploads/2023/09/f419d673-f1fc-440c-94a0-785af153b2da.mp3 Lenders should always review SBA’s Servicing and Liquidation SOP when engaging in liquidations of SBA loans. This article will take a high-level look at the changes incorporated into the SOP 50 57 3 (the “SOP”), which went into effect August 1, 2023, that impact liquidation of real property and personal property collateral. Financial Hardship ... Read More
Best Practices: Exploring the revisions to SOP 50 57 (3): Modification of Collateral
https://starfieldsmith.com/wp-content/uploads/2023/09/a88b7160-76aa-4e20-bb58-603ae20659ff.mp3 SBA lenders must be careful to not only follow the updated guidance in SOP 50 57(3) for liquidation and guaranty purchase, but also for SBA loans in regular servicing. While many changes to the standards of Modification of Collateral – Chapter 8 of the SOP 50 57 (3) were typographical in nature, a few ... Read More