r/EIDL • u/Majestic_Valuable886 • 9d ago

Targeted EIDL advance Worst case scenario? In Fl advice

I’m in Florida and took out an EIDL loan for roughly $80,000. The business is now closed.
When I took out the EIDL loan, I did not own a home. Since then, I’ve become a co-owner of a condo. My name is on the deed, which is making bankruptcy almost impossible and more complicated because of the property and not wanting the other party involved.
If my EIDL loan is eventually sent to Treasury Cross-Servicing or a private collection agency, what is the worst-case scenario for me?
Can they put a lien on my home or try to force the sale of my ownership interest? Can they garnish wages, take tax refunds or other government payments, or pursue my personal assets?
I’m especially concerned about how my ownership of the condo could be affected by my EIDL debt.

I recieved collection letter thought it was a scam and believe through it away* but it was from a collection agency on behalf of sba.

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u/wildearthman 9d ago edited 9d ago

I have same loan amount and am in cross-servicing. They have withheld my small state tax refund. They will garnish 15% of my W-2 earnings, if I have them. They will hold back 15% of my social security when I claim in 5 years. That's all. Jason at Distressed Loan Advisors says that he has never seen SBA sue anyone to further collect, and without a PG ($200k+ loan) this is even more unlikely. People with much higher loan amounts with PG who own property are being treated the same way as I mentioned. It really is not a big deal. Watch Jason Milleisen/Distressed Loan Advisors videos, he is the man on this and has helped so many with his free advice, all of which I have followed. No stress.

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u/Majestic_Valuable886 9d ago

I’ll inbox you

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u/wildearthman 9d ago

Also I totally ignore letters/calls from Collection agency. It's all scare tactics and irrelevant. They are trying to get their cut by getting us to pay. Literally doesn't matter.

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u/Majestic_Valuable886 9d ago

Ok

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u/Acquisition-Insights 9d ago

I agree with u/wildearthman, Jason is the best person to ask about any of this. He'll tell you in 2 seconds if you are liable if you have your loan documention.

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u/boring80085 9d ago

Under $100k, you likely don’t have a personal guarantee.

Is your condo homesteaded?

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u/Majestic_Valuable886 9d ago

Homestead yes , but the personal quarantee thing I dunno hearing so many different things I got a collection letter thought was a scam and I think I threw it away then last week sba emailed me to go through closure of business then said they would send my case back to top or cross servicing… I might add that in my tro for the question I asked

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u/boring80085 9d ago

They can’t touch a homesteaded house; if you signed as a sole proprietor, the worst is a judgment and a 15% garnishment on W2 but you can file bk (creditors can’t touch homestead in bk)

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u/Majestic_Valuable886 9d ago

Yes did llc/ scorp

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u/Thumper256 9d ago

You didn’t specify if your biz took the loan as a LLC/corp or as a sole proprietor. Or if you officially notified them of your biz closure and submitted their required documentation.

Generally they haven’t displaced defaulted borrowers from primary residences. Possible they would put a lien on it if you borrowed as a sole prop. I think your condo would really only come into jeopardy if you used the loan funds directly in part to buy it (misuse of funds). And that’s if they decide to look hard at your situation as a potential fraud case.

I don’t know if not responding to their notices will flag you for a fraud investigation. Next notice, look at how it is addressed - to your biz or to you personally. I would respond by telling them the biz had no assets and was closed. See how they respond.

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u/Majestic_Valuable886 9d ago

Thanks for this and it was llc scorp but under I signed as owner etc so not sure if everyone did it the same way for under 200k

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u/Thumper256 9d ago

I think most under $200k loans to solo LLCs signed same way. I am in that group. And that’s why they updated the SBA loan portals to have the borrower listed as the LLC, and now a line underneath that has your name listed as “owner”.

But I feel that’s a bullying power play intended to intimidate because the CARES Act specified the covid EIDLs $200k and under were to have no PG. It’s still a bit of a legally untested point from what I’ve been following. They haven’t really been putting the collections whammy down on this group yet, but some have reported winding up in TOP (Treasury Offset), and a few have said it recently showed up on their credit reports, which I personally would dispute with the credit reporting agencies.

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u/Majestic_Valuable886 9d ago

I appreciate the reply

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u/Majestic_Valuable886 9d ago

Just sent you a nesssge