Can you declare bankruptcy on a Small Business Administration (SBA) loan?
While the common perception is that you cannot discharge government loans in bankruptcy, in reality, many such loans can be discharged in bankruptcy. The Small Business Administration (SBA) does not directly make loans; rather, it guarantees at least a portion of the loans, which reduces the risk of liability should the loan go into default. Therefore, SBA loans are dischargeable in bankruptcy proceedings.
Other Debt Relief FAQs
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Q:
What Is A Discharge?
A: The discharge order is issued by the court and permanently prohibits creditors from taking action to collect dischargeable debts against the debtor personally; this … More -
Q:
Can a bankruptcy court cancel a promissory note?
A: Yes. If your debts are successfully discharged in bankruptcy, then your outstanding promissory notes that deal with your current loan obligations are … More -
Q:
What Debts Are Dischargeable?
A: 11 U.S.C. Section 523 lists exceptions to discharge. In general, all other debts are dischargeable. Some debts listed in Section 523, such as those based on fraudulent … More -
Q:
What Is A Priority Debt?
A: A priority debt is a debt entitled to priority in payment in a bankruptcy case. A general listing of priority debts is given in 11 U.S.C. º 507 of the Bankruptcy … More -
Q:
Can a creditor object to bankruptcy discharge?
A: In a Chapter 7 bankruptcy case, you are not automatically entitled to a complete discharge of your debts. Rather, your creditors can object to the discharge of … More -
Q:
What Is A Secured Debt?
A: A secured debt is a debt that is backed by property. A creditor whose debt is secured has a right to take property to satisfy a secured debt. For example, most homes … More -
Q:
What Is An Unsecured Debt?
A: A debt is unsecured if you have simply promised to pay someone a sum of money at a particular time, and you have not pledged any real or personal property as … More -
Q:
What Is An Administrative Debt?
A: An administrative debt is a priority debt. An administrative debt is created when someone provides goods or services to your bankruptcy estate. The best example of an … More -
Q:
What About My Student Loans – Can I Discharge Them?
A: In general, student educational loans are not discharged under bankruptcy. There are exceptions in which a court may discharge the debt especially where paying … More -
Q:
What Is A Reaffirmation Agreement?
A: A reaffirmation agreement is an agreement by which a bankruptcy debtor becomes legally obligated to pay all or a portion of an otherwise dischargeable debt. Such an … More
