Best Practices: Requirements for the Universal Purchase Package
https://starfieldsmith.com/wp-content/uploads/2024/03/a4d5ccff-6481-4ca4-9c2f-563d821d03cd.mp3 On August 1, 2023, the SBA unveiled its new streamlined Guaranty Purchase package. The new Universal Purchase Package (UPP) now takes the place of the former SBA 10 Tab Package. There are now 8 Tabs, instead of the previous “10 Tabs” that Lenders were required to submit. While the guaranty purchase package has changed, ... Read More
Best Practices: Bridging the Gap with Interim Advances
https://starfieldsmith.com/wp-content/uploads/2024/03/6ad559dc-fa28-4dfb-b6aa-24f346565790.mp3 Since the SBA 7a program is designed to expand access to capital for small businesses who cannot obtain credit elsewhere, lenders must ensure that all diligence items have been cleared before moving forward with closing. As such, it is generally understood that a closing for an SBA 7a loan can take some time due ... Read More
Best Practices: EIDL Lien Subordinations and Collateral Releases
In response to the COVID-19 pandemic, the Small Business Administration (“SBA”) granted low-interest, long term Economic Injury Disaster Loans (“EIDL”) to millions of small businesses. While the pandemic no longer dominates news headlines and the EIDL program no longer issues new financing, 7(a) Lenders are often required to address these existing EIDL loans when lending ... Read More
Best Practices: Requirements for Commercial Real Estate Appraisals
https://starfieldsmith.com/wp-content/uploads/2024/02/dda41455-5d3a-4798-8186-41a6ce7f4b35.mp3 SBA’s guidance on real estate appraisals depends on the type, size and use of the SBA loan proceeds. This article focuses specifically on the basic commercial real estate appraisal requirements for Standard SBA 7(a) loans (meaning loans of more than $500,000) that are secured by commercial real estate. These requirements are set forth in ... Read More
Best Practices: Servicing Subordination Requests
https://starfieldsmith.com/wp-content/uploads/2024/02/cacd7fe2-c4b7-425e-8f2a-1ce5cace2542.mp3 After loan disbursement, SBA lenders are often asked by borrowers to subordinate the position of a lien securing an SBA loan. Lenders must consider these subordination requests in the context of Prudent Servicing actions as set forth in SBA’s Servicing and Liquidation SOP 50 57 3 (the “SOP”). Generally, the borrower must demonstrate satisfactory ... Read More
Best Practices: Why Do You Need a Business License Anyway?
https://starfieldsmith.com/wp-content/uploads/2024/02/e8312a16-a27e-4848-9218-0d918852c9a2.mp3 Although there is no extensive discussion in the SBA’s Standard Operating Procedure 50 10 7.1 (SOP) regarding borrower’s compliance with business license requirements, the SOP does make it clear that the lender must obtain evidence from the borrower of all licenses required to operate the business within 90 days after final disbursement of the ... Read More