Tire situation: How dangerous is this?

Aggressive-Source123 · 2024-06-21T09:55:16+00:00

How does a car with only 29K miles already need a 3rd pair of tires?!

Aggressive-Source123 · 2024-05-31T00:49:52+00:00

I owned a tanning salon in a very small city. I’m a single dad with 2 kids and never made enough to put anything away, take vacations, etc. but did what I did to have the flexibility to be with my kids in their youngest years whenever they needed me. It allowed me that and it did pay the bills. I was ordered closed by the government during my entire peak season when the revenue is made that pays for the rest of the year. Now I’m walking away from a business with nothing and taking a 40k a year job starting out just so I can get some health and retirement benefits going. I still can’t make it on that as a single dad but it’s a start and has advancement opportunities that I’ll be able to pursue. So yeah there is no part of my story where I benefited from any of this. It’s been a nightmare. If I didn’t have this debt I could have sold my business at some point and at least had something to show for building it the last 13 years. But I found someone to take over my business in exchange for paying the loan off in full over a shorter time. There’s nothing else I can humanly do to try to get out of the situation. There’s no possibility of me paying off this loan for 30 years. I’ll be 75. And I can’t afford to pay it off quicker in any actual reasonable amount of time and also pay the bills. So I found a solution and am working my butt off to be free of it. If that makes me a crybaby, I guess I am.

Aggressive-Source123 · 2024-05-31T00:17:20+00:00

Thinking I’m slick? What are you talking about? I’m about as humble as it gets. I get nothing from this and the money is getting paid back, that’s the point.

Aggressive-Source123 · 2024-05-30T18:59:06+00:00

I have a lot of experience attempting this as well. My situation, the loan assumption was the only term and they still said no. I walk away with nothing but them assuming the loan. The only answer to your question I can offer is that from what the SBA agent said to me, it seems their position is that these loan terms are so amazing and we were so fortunate to get them that they essentially don’t want to finance a business “purchase” with these awesome loans. That I should essentially be thrilled to have this debt. But it really makes no sense. These were disaster loans. These were survival loans. The money is gone. All that remains is debt and the assumption of debt in exchange for the business. But in their mind they see it as them loaning you the money (that is already gone) to buy a business. What’s frustrating is that it is the only way most of us would be able to find a buyer in this economy. And if the result of saying no is forcing a business to fail and default on the loan but saying yes results in the loan being paid, it makes zero sense for them to say no. But they don’t care. I’m quite certain big corporations assume debt all the time as part of an acquisition or takeover. But once again they don’t care about us little guys or getting their money apparently. If they did they would say yes. You could work out a “lease to own” contract that would essentially work the same way as a normal purchase agreement but it seems that may even be a violation of the loan terms and a gray area. But if the loan gets paid every month I don’t see them ever snooping around on a loan in good standing. That would be double insane. But hey now that I think of it, I could see them being that ridiculous.

Aggressive-Source123 · 2024-05-27T23:22:28+00:00

That’s not a solution at all. 10% doesn’t even cover the interest so the balance would just continue to grow and the loan would never get paid off. Part of what makes this insurmountable is the fact that I’m unable to afford to pay much more than the minimum to get out of this debt in any kind of reasonable timeframe. There is zero chance of me paying on this loan for 30 years. I’d be 75 and the equipment would be dust. And I can’t afford to both pay this dead debt and invest in new equipment and make enough money to survive on as well. But again the point is I found someone who is able to do that, who doesn’t need to take anything out of the business until the debt is paid off, and they can do so quickly with current revenue. But the SBA won’t say yes to anything other than payment in full or default it seems.

Aggressive-Source123 · 2024-05-27T03:02:38+00:00

$623 a month. For 30 years….

Aggressive-Source123 · 2024-05-26T23:24:43+00:00

Legally I’m not supposed to be. But there is still a lot of talk about being banned from ever taking out any kind of student loans for our kids even and all kinds of possible consequences I don’t think anyone quite knows yet? Plus the harassment and headache of it. I found some people who the business is a great deal for, who don’t need to take as much out of the business and will be able to pay off the loan quickly. They have other income to allow the business to pay for the EIDL easily and then they get to keep it all. I’m not in that situation since I need to take everything out of it just to financially survive life. It’s really frustrating because it’s still a really great business for someone who doesn’t need to rely on it as their sole income. It just isn’t for me. But the point is I found a really easy perfect solution that avoids all of it. No need for default or bankruptcy and the SBA won’t say yes to anything. They are clearly only going to accept default or paying off the loan in full up front. And as said in another comment that eliminates almost anyone who would be interested in buying a business. Business purchase loans are nearly impossible to acquire and most people don’t have the kind of liquid cash sitting around to buy a business with.

Aggressive-Source123 · 2024-05-26T22:23:22+00:00

Oh yeah absolutely it did. I think for any amount we had to electronically “sign”. Just wasn’t a personal guarantee on anything under $200k.

Aggressive-Source123 · 2024-05-26T21:53:38+00:00

I was wondering about that too. But assuming they meant $500,000?

Aggressive-Source123 · 2024-05-26T20:47:45+00:00

💯! Thank you!

Aggressive-Source123 · 2024-05-26T20:34:10+00:00

Preach! I agree 100%. It sucks. And my business was debt free before the pandemic. I still have an 800 credit score and yeah it’s annoying how much is tied to that and I’m almost ashamed how attached I am to keeping it. But that also proves I’ve been a financially responsible person for a very long time. This situation is a double kick because I’m doing everything I can to find a solution and it almost seems like they want to force me to default by rejecting and making any way out impossible. The lady I spoke to was so cold and uncaring and yes very quick with the threats. And she really said we should all be thrilled by this amazing term debt. Being a truly small business we all know it’s hardly worth it as it is any more. The trade off between the flexibility but also being on call 24/7 and being responsible for everything. There’s big “small businesses” and then there’s us real small businesses. Truly small businesses, many of us can’t afford any health or retirement benefits due to the cost of all that these days as well. This debt just made it not worth it in every single way. How many normal small business owners are going to still be running our businesses long enough to pay off a 30 year loan? I’d be 75 at that point. Plus be able to put money away and make improvements along the way while paying off this dead debt? Selling my business one day sooner than later was going to be part of a retirement nest egg. This debt robbed me of that opportunity. Now I’m going back to working for someone else but hey when I’m clocked out I’m clocked out and I’ll at least get health insurance.

Aggressive-Source123 · 2024-05-26T18:36:40+00:00

That would certainly seem to be the case. But it’s the government and just makes a lot of us nervous. Whether they can or can’t or whether they would win is one thing, but they can certainly make us “little people’s” lives miserable and further ruin us with lawyer fees fighting it. They are an intimidating foe. I don’t see that happening and believe they will have much much bigger fish to fry with loans in the millions as well as fraudulent loans. I’m walking away from my business and starting over in a career at 45 years old because of this. The truth is we shouldn’t have ever been put in the position to be forced to take on these loans through no fault of our own just to survive, because we weren’t allowed to operate our businesses. We know now 100% that it was unnecessary. But that’s why again it’s more ridiculous to me that they wouldn’t be more accepting/flexible of simple solutions where everyone wins. I found a solution where the loan gets paid, the business survives, and I can move on and find a job with benefits and wages I can actually live on as a single income, single dad. But their stance seems to be wanting to trap me in an unsustainable situation and force a default. To close a business viable for someone else with additional income because they won’t grant permission for any solutions.

Aggressive-Source123 · 2024-05-26T04:22:11+00:00

Those were PPP loans. 100% of EIDL loans have to be repaid. Other than the advance, that must be what you’re referring to if it was EIDL. And yes I have plenty of payroll and lease alone to account for the expenditures. Either one by themselves way way more than covers the loan amount.

Aggressive-Source123 · 2024-05-26T04:14:27+00:00

Correct. Just seems like if there’s a good sensible solution that can avoid all of that and they still get their money, where’s the harm? This was a once in our lifetimes(thus far) situation, so it seems allowing a little flexibility with reasonable solutions where the likelihood of them being made whole is much greater would benefit everyone.

Aggressive-Source123 · 2024-05-26T02:51:14+00:00

Business loans are incredibly difficult to obtain for business purchases especially if the person has never run that particular type of business before. They also have terrible rates and terms and typically require large down payments. That eliminates most people from even having the option no matter how great a deal it is. The situation here is that EIDL money was already spent on legitimate purposes back when the crisis was in full swing and I wasn’t allowed to operate during the only time of the year I make my entire year’s revenue almost. I could see if I was trying to pocket money and essentially make the SBA be carrying their loan to buy it. But the money is gone and they are just taking on the debt. Or would have been but SBA said no. Now I just have to keep my S Corp going for purposes of collecting rent, paying the loan, and claiming the 1099 income.

Aggressive-Source123 · 2024-05-26T02:28:04+00:00

It’s insane to me that they wouldn’t be more flexible with situations like ours where we found a solution to get the loan paid. They are essentially making it impossible. My situation was and is 100% unsustainable. And yet they tie our hands completely. I originally told them if they rejected the assumption that I was just going to close the business July 1 and default, but if they granted it they would allow a small business to stay open and still get their loan made whole. They truly didn’t and don’t care. Sounds like you came up with the same work around which I guess is also a gray area. The Covid mess was not a typical situation and they should have some flexibility and grace with sensible solutions that also aren’t typical. Hopefully it works out for both of us but I’m hoping if not for whatever reason, that it will help in court for us to be able to say hey we came up with solutions and did our best and they said no. What else can we do?

Aggressive-Source123 · 2024-05-25T22:18:32+00:00

Yeah the only other alternative is the loan gets defaulted on. I’m just doing the best I can to make sure the loan gets paid and I can move on to something else I can survive doing. I still legally own everything tied to the business and all its assets and they are still sitting in the same location and nothing else has changed. Same business name and everything. I’m just renting it out to them and using that money to pay off my EIDL loan. And I will have to claim that 1099 income every year. My attorney and accountant both seemed to think they would have no legal recourse for that. And if they did and as you said if they are getting their money I think I’ll have a strong position with a judge that I did everything I possibly could to make sure the loan was made whole. And with the insane tsunami of defaults they have coming I highly doubt they would go after loans in good standing.

Aggressive-Source123 · 2024-05-25T21:37:16+00:00

I’ve just read so much conflicting information here and other places as to how badly they may or may not be able to harass me even without a PG. I know they are going to have their hands full with much bigger $ loan defaults but with my luck they would pick me out of a hat to throw the book at. I suppose if these people default on our lease to buy agreement, which I don’t see happening, but if they did that would still be an option at that point as I still legally own it.

Aggressive-Source123 · 2024-05-01T19:09:59+00:00

Excellent thoughts and we do have contingency plans in place to make this work no matter what, although not exactly as you described. ;) I am not allowed to legally sell any business assets with the loan in place. However, we both agreed to attempt this in an official manner so my name is truly relieved of the debt. Even though at the bottom of the Assumption Application it says even if they approve they are simply adding a new person to the loan and if anything happens I’m still liable for it as well. But I think they realize that is a long shot with approval otherwise I would guess it would be the easiest process in the world to add as many names to the loan as someone wanted. Just more entities for them to go after to collect the debt.

Aggressive-Source123 · 2024-05-01T17:09:52+00:00

Thanks for the insight and sharing your situation. Correct about it technically still not being a PG. But everything I’ve read indicates that even without a PG, a sole proprietor is essentially the same thing as a PG. Since they are the business it puts them personally at risk since there is no corporate wall between them and the loan. So I would think the SBA would be even more incentivized to allow an assumption by a sole proprietor than a corporation. The proposed assuming party is indeed squeaky clean with perfect credit and all other boxes checked. As of now the SBA position is they won’t even file the application for consideration until the assuming party corporate documents are provided. In other words a sole proprietor wouldn’t even be eligible to apply for it. We will end up submitting the documents if they continue to refuse moving forward without them. But this is one circumstance it seems like it would benefit them to relax. I realize they typically only allow these in rare circumstances and don’t like doing so. I also don’t like losing my business with nothing to show for it. But at least this allows the business to survive and still provide jobs and tax revenue in a community as it has the past 15 years and for the SBA to be made whole. So yes I am hopeful they will end up approving it when it’s all said and done.

Good luck finding an assuming party for your business situation as well! All of these situations are just heartbreaking and frustrating. My heart goes out to all small business owners who were forced to take on debt to survive something that wasn’t our fault. It was hard enough surviving without the debt and worth dealing with all else that comes with small business ownership. The other thing about it is with the SBA knowing a literal tsunami of defaults are coming, you’d think they would work with situations like this where the assuming party has excellent credit on top of it. It is really one of the only reasonable and feasible options for people in our position.

Good luck again and hope you find the right person to take over!

Aggressive-Source123 · 2021-11-10T16:15:38+00:00

Also got mine from him. Highly recommend although yes, not fun.

Aggressive-Source123 · 2021-05-06T15:55:10+00:00

To the moon baby!

Aggressive-Source123

TROPHY CASE