June 9, 2021
C-Suite Wednesday — OCRM Says Quick Closings are The Biggest Red Flag on SBA Loans
Yesterday, the Georgia Lenders Quality Circle (GLQC) held their first virtual conference in a series of monthly sessions planned to take place between June and November.
Here are some of the highlights from the first session of GLQC’s Southeastern Small Business Lenders Conference:
- The OCRM’s top concerns are training, software, internal controls, and LSP agreements.
- According to OCRM, quick closings are the biggest red flag on SBA loans. However, OCRM is also carefully watching debt refinance loans, loans that are sold before being fully disbursed, and business acquisition structures.
- OCRM has been prioritizing the review of SBA Form 159 over the past couple of months. However, beginning in June, they will be shifting their emphasis to reviewing SBA Form 1050.
- The SBA plans on rolling out clerical changes to the PPP forgiveness process within the next two weeks. Nevertheless, the agency wants borrowers to apply for forgiveness as soon as they are ready.
- The SBA is working on PPP servicing guidance. It was clarified during the conference that PPP servicing will differ from 7(a) servicing because PPP loans do not require collateral and they are 100% government-guaranteed.
- Cash-flow analysis for loans in 2021 should explain why 2020’s numbers do not match future projections.
- The SBA is working on a few updated SOPs. However, no details have been formally announced.
Click here to learn more about the Southeastern Small Business Lenders Conference series and to sign up for future sessions.