Can I Discharge My SBA Loan Under A Chapter 7 Bankruptcy?
Why Chapter 7 bankruptcy?
As a result of the ever-declining economy, many small business owners are having to face the harsh reality that they will not be able to continue their business let alone pay off their Small Business Loan (SBA loan). Many small business owners have become aware that their best alternative is to file for Chapter 7 bankruptcy. By doing so, they are able to discharge their SBA loans. In many cases, they are also able to save their home and other possessions as well.
The truth about Chapter 7 and SBA loans
In the simplest terms, with the exception of student loans, most any loan issued by the government is subject to discharge. A common misperception about bankruptcy is that any debt associated with the government cannot be discharged in a bankruptcy filing.
Actually, the opposite is the truth. Most loans issued by the government or a municipality can be discharged in a bankruptcy case.
All the loans that could be governmentally issued, the broad majority of those loans are in fact, dischargeable in a bankruptcy filing.