The answer to this question depends on a variety of factors. In Texas, a borrower’s homestead may not be pledged as collateral for an SBA business loan and the lender will not seek to do so. However, in many other states this can and does occur. But, generally speaking, while there is no statute of limitations applicable to a foreclosure action by the government, the SBA cannot obtain a judgment to collect any deficiency remaining on the delinquent loan, post-foreclosure, if the six-year statute of limitations for suit on the loan has passed.
SBA loan default blog
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The Perliski Law Group is dedicated to helping small business owners survive the closure of their business and the resulting financial damage caused by an SBA loan default. During your free initial consultation, we will explain how the SBA collection process works and outline the SBA debt relief and SBA loan forgiveness options that may be available to you.