Thousands of restaurants took COVID Economic Injury Disaster Loans to get through 2020 and 2021. Many of those loans are now in default. The SBA has been moving delinquent accounts into collection and Treasury referral, and on loans above $200,000, the owner’s personal guarantee exposes personal assets.
Owners in default still have options, and each one depends on timing: hardship accommodation, offers in compromise, negotiated resolutions, and, where the business cannot recover, a structured exit through bankruptcy or a sale that addresses the SBA’s lien. Ignoring the loan removes those options one at a time.
The resources below explain where the SBA stands now and how restaurant owners are resolving these loans.
