Fear-Mongering For Free

We’ve had people accuse us of trying to frighten business owners about the consequences of failing to comply with the terms of or failing to repay their COVID-19 EIDLs.

These folks, in our opinion, are getting their fake-expert-opinion-troll advice from a crowdsourced knowledge base. 

That’s where a bunch of people get together on a chat and discuss their thoughts, actions, and results, on any given topic, and in this case, it’s the COVID-19 SBA EIDL Program.

While those forums can be an excellent starting point on a journey to research and learn, one should discern that when it comes to a complicated topic, the crowdsourced knowledge base, taken as their only source of expertise, is a disaster in the making.  

Especially when it comes to the SBA and the COVID-19 EIDL program.

You have to take the information you gather from online forums and then seek out actual experts before you make final decisions on any given action. 

You’re not simply gathering other people’s opinions to decide if a pizza restaurant is up to the standards you expect because you’re a person who loves pizza and you want only the best pizza!

We learned how the SBA’s COVID-19 EIDL program works by working on hundreds of actual files, and speaking to hundreds of SBA Agents and thousands of Small Business Owners. 

Before COVID, we both worked in financial services. That’s where we get our expertise and our expert opinions due to prior experience with financial services processes and products.

Some folks interpret our approach as trying to frighten business owners to sell our products and services. 

There’s so much wrong with that. First, we’re trying to warn business owners that there are serious restrictions and important responsibilities they need to be mindful of. If ignored, there are consequences.

Second, are these people business owners? Logically, they must be because the COVID-19 EIDL program was for business owners to survive the lockdown during the first global pandemic in our lifetime.

If that’s the case, did they go into business to not make money? That’s absurd.

Our vocal efforts are to warn folks to not listen to bad crowdsourced advice which is to give up, walk away, and not pay the loans if their business is in trouble. 

With this cavalier approach, costly consequences are possible.

We don’t do this because we’re “hucksters” and “shills” based on the opinion of two people accusing us of this activity. 

We do this because we have business owners contacting us EVERY SINGLE DAY with their worries and anxieties. 

These folks can be worried about something very simple, such as changing the address of the business or spending the remainder of the EIDL funds. They seek sound, trustworthy guidance to know they won’t be in trouble with the SBA or the government.

During the pandemic, we heard from a couple of business owners who hired us or asked for our advice and they said, 

I don’t want to screw this up and get in trouble.

Trevor was a mortgage banker. He’s had similar experiences with trends in the mortgage business, whether it’s the rise of sub-prime mortgages, or people taking advantage of federal programs to save their homes when they didn’t need saving, and more. 

If you look back at his mortgage blog going back nearly twenty years, you’ll see he’s offering the same warnings about trends and bad advice.

Is it a bad thing that we care passionately about Small Business? So be it. We’re okay with that. We’ve met some incredible people along the way that we truly admire. 

However, our passion has given fuel to trolls and haters because sometimes our passion comes off as aggressive and arrogant. It’s because we know what needs to be done and we’ve seen the bad advice and costly mistakes as a result.

We created our comprehensive expert guidebook the Post-Closing EIDL Blueprint for those business owners who care about consequences and as a way to budget cash flow instead of costly consulting hours to get the job done. 

We created it because we KNEW these questions, these challenges, and these worries would come up.  We knew we would only be around to provide direct advice for a short time because we are building other businesses.

When we warn folks and it sounds like “danger,” it’s with the hope that people will hear our message to be careful with their responsibilities under the loan agreement and repayment. 

  • Do we value our expert backgrounds? Yes.
  • Do we feel that we deliver value? Yes.
  • Did we go into business to NOT earn a living. No!

We decided to sell our experience and processes that we know work. It’s no different than a marketing expert getting paid to share their experience and knowledge.

Take the information you gather from the crowd, coalesce that information into basic answers to your questions, and then seek out a professional expert to give you more information. 

If you take that course of action, you will dramatically improve the odds of making the best possible decision for you and your business.

When you’re done, treat yourself to a nice pizza, because…who doesn’t love PIZZA!!?

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Are LLCs Immune from COVID-19 EIDL Debt Collection?


We received the under-noted comment/questions on one of our YouTube videos. Both our video and this comment serve to demonstrate the continuing dysfunction of the United States Small Business Administration (SBA), especially with its terrible communications and procedures.

Question: Are you speaking on EIDL loans granted to LLCs? Isn’t the whole point of an LLC to limit liability? How can SBA go after anyone personally if the LLC entity that took out the loan is dead and no personal guarantee was made? I think it’s important to differentiate between these nuances in these discussions.

Our Response: Thank you for your most excellent observation!  You are absolutely correct on your two key points:

  1. The LLC should protect the “corporate veil” concept, and SBA acknowledged that fact in a written memo to Congress last autumn.  BUT…BUT…BUT…once these loans go to collection at the US Treasury and the IRS attempts to collect on the debts, will the IRS also honor the corporate veil?  Technically they should, but the purpose of our discussion in our videos is to warn people to expect the unexpected because this COVID-19 EIDL Collection process is new and developing literally day-by-day.
  2. Yes, you are correct there should be more clarity about these nuances, but there is NONE from SBA. ZERO. NADA. ZILCH. As for our part in these discussions, we are only observers attempting to assist Small Business Owners in understanding the possible consequences and ramifications of failing to pay their COVID-19 EIDLs, especially since our message is focused on countering the internet opinion trolls who would have everyone believe they can simply walk away from these loans with no consequences.

We started working with the COVID-19 EIDL program in March 2020 as the pandemic started to unfold.  From the outset, we discovered, as seasoned financial services professionals, how badly SBA communicated information about the COVID-19 EIDL program.

These failures in communication cover the breadth of platforms: SBA website, FAQs, legal documents, applications, even simple sentences embedded in SBA forms and website information.  Then there is the consistent failure of SBA to properly train and educate its representatives.  We have an old saying here at Aurora Consulting: “Ask the SAME question of 7 different SBA Agents, get 13 different answers.”

We’re seeing these terrible communications come to a chaotic climax with the many small businesses struggling to repay the COVID-19 EIDls.  Whether a business is attempting to repay the loan by requesting accommodation for reduced payments, or the simple exercise of setting up the initial payment profile on the SBA website, confusion rules the day.

In December of 2023 and so far this month, January of 2024, SBA appears to be “bulk” shipping defaulted COVID-19 EIDLs to US Treasury for collection actions.

Even loans where small business owners made payments have been shipped off for collection.

And, again, there is no communication from SBA.

Worse, if a loan has been sent to US Treasury and the small business owner wants to make a lump sum payment to bring the loan current, or, worse, if they have recently made the lump sum payment to SBA only to receive a notice from US Treasury for collection, when you call SBA they hew to a scripted standard line: “You will have to ask US Treasury.”

The failed communications extends to US Treasury. IF you can get a representative on the phone, you are told to contact SBA about making the payment to bring the loan current.

THIS is an absolute nightmare.  If the SBA were a commercial lender subject to the laws and regulations of federal banking codes, they would probably come under investigation by the Justice Department or State banking authorities for these egregious behaviors.

We will update small business owners as this situation unfolds with the real-time real-world experience we garner from working with small business owners and the SBA.

We offer a one-hour consulting call with our Resident Retired Loan Officer, Trevor, to help small business owners understand their situations and recommend next steps in their repayment or default strategies.