Economic downturn. Changes to interest rates. You know what’s coming, right?
An increase in troubled loans. Which means an increase in workouts and liquidations.
Not fun, for anyone involved – you as the Lender, or your unhappy, struggling Borrowers. And the emotional impact of financial stress makes it that much more challenging for all concerned.
The anxiety the Borrower and its Principals are experiencing is often deflected upon – or should we say, inflicted upon? – you, the Lender. It’s not fair – you didn’t create the economic issues, after all – but it’s an understandable reaction from Borrowers who never expected to run into problems.
And if you don’t have a dedicated collections or special assets department with SBA experience, or these Workout and Liquidation events have (up till now) happened infrequently, you may really be feeling the strain.
Let’s look at five tips to help you manage the process.
