Legal Question in Bankruptcy in California

Bankruptcy

My wife and i run small business and are going thru a divorce. She has asked if i am willing to take over the business and the $65k worth of debt that has accumulated. One of those debts is an SBA loan. I'd like to know if this type of loan can be included in a bankruptcy if I can't handle all of the debt?


Asked on 4/13/09, 2:11 pm

2 Answers from Attorneys
Chris Johnson Christopher B. Johnson, Attorney at Law

Re: Bankruptcy

It can be included, but you'll have to see what it was secured by, if anything--the SBA may be entitled to those assets if it was secured. Also, if your wife agreed to be responsible for the loan as well, the lender will look to her for repayment unless she also files for a bankruptcy. Have an experienced bankruptcy attorney review the debts, assets and personal guarantees to see what the effects of a bankruptcy would be.

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Answered on 4/13/09, 2:15 pm
Carl Starrett Law Offices of Carl H. Starrett II

Re: Bankruptcy

SBA Loans are dischargeable in bankruptcy, but there may also be a lien against your home or other property. You need to speak with a bankrutpcy attorney and your divorce attorney about what impact these issues will have on your divorce.

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Answered on 4/13/09, 2:20 pm


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