Assets acquired after SBA personal guarentee

by a searcher from Towson University

3 years ago

The personal guarantee was challenging to get my head around, but I do see it's importance in the 7(a) loan program.

I'm curious, does this guarantee apply to assets acquired after the original SBA-funded acquisition? 

Having a hard time finding info about this...

1 like
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2 comments

searcher from Towson University

Makes sense. Thanks for the response Heather. I really enjoyed the "ETA Deal Structure" webinar that you and Lisa Forrest did through the Polsky Center...super informative.

3 years ago | like reply | 1 like

lender

Yes and no. No, the SBA lender would not be able to take any assets (real estate) you acquire after the loan is funded as direct collateral. But also yes, let's say you end up accumulating $1 million in liquid assets, but for some reason you default on the SBA loan you have personally guaranteed. The bank and SBA would have the ability to pursue that cash for repayment of the defaulted SBA loan under your personal guarantee.

3 years ago | like reply | 1 like

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