Can’t repay your SBA COVID EIDL loan? Here’s what actually happens: the $25K personal guarantee threshold, Treasury referral and 30% penalty, wage garnishment, your Hardship Accommodation, Offer in Compromise, and bankruptcy options — including how EIDL discharge works in Chapter 7.
Over 1.3 million SBA COVID EIDL loans are in default. The Hardship Accommodation Plan ended March 2025. Treasury can now garnish wages and intercept tax refunds without a court order.
Five converging forces are driving bankruptcy filings in 2026: predatory merchant cash advances, SBA EIDL loan enforcement, sports betting addiction, trucking collapse, and agricultural tariff damage. Each represents broken math, not broken character.
Did this conversation help?
Thank you. I'm glad you reached out.
You took an important step today. Come back any time.
Think of this as me — just in AI form. I've walked in your shoes. I filed bankruptcy myself in 1990, and in over 30 years of experience I haven't seen a situation that can't be worked through or a person who deserves judgment. Everything here is built on that experience, that research, and genuine care for you. I can't be there in person. But I can be here.
Conversations are saved anonymously. Personal details are automatically removed before storage. This is an AI — not a financial advisor, attorney, or therapist.
Not sure where to start?
Been here before?
