---
title: Properly documenting SBA 7a loan deferments
description: I know many of you have had SBA 7a customers calling and asking for loan deferments. Here is a guide of how to document your loan file.
---

[First Federal Bank Blog ](https://blog.ffbf.com)

# [Properly documenting SBA 7a loan deferments](https://blog.ffbf.com/properly-documenting-sba-7a-loan-deferments)

 Written by [Rob Hughes](https://blog.ffbf.com/author/rob-hughes) | March 18, 2020 5:00:00 PM Z

I know many of you have had SBA 7a customers calling and asking for loan deferments. Below is a guide of how to document your loan file.

### Step 1

[Have the borrower fill out this PDF](https://blog.ffbf.com/hubfs/Modification%20Request%20Form.pdf?utm_source=hs_email&utm_medium=email&_hsenc=p2ANqtz-9Yn74Xcis9zlf9oFPMWFqDmuyeLfniq0c9HPWCy3p3cpQPs59c9TaeXZeBjHknSB_sckOd). File on their requested deferment.

### Step 2

Make sure you have a recent income statement and balance sheet (or current tax returns) for the business and all principals. If your personal financial statements are older than one year request an updated one.

### Step 3

Write a short memo (can be a Word document) to the file indicating the bank is doing a 90 day deferment and the reason for the deferment. Complete a short cash flow analysis based on your updated financial information.

### Step 4

Have the borrower sign a modification form to defer the payments similar to what you would use on a regular commercial loan.

### Step 5

**If the loan** ***IS SOLD*** **in the secondary market**

You will need to notify Colson Services Corporation at [info@colsonservices.com](mailto:info@colsonservices.com)  Let them know the payment dates you are deferring. In the subject line put the SBA loan number and the name of the borrower. Put a copy of this email in your file. **You cannot do the deferment until you have Colson approval.** Once you have Colson approval, send a copy of the Colson approval email, a copy of the signed modification, and your short memo to [lrsc.servicing@sba.gov](mailto:lrsc.servicing@sba.gov).

**If the loan is not sold in the secondary market**

Send a copy of the signed modification, and your short memo to [lrsc.servicing@sba.gov](mailto:lrsc.servicing@sba.gov) .

### Step 6

**Colson 1502 reporting:** Once step 5 is completed, you will need to change the SBA status code for the months you are deferring to a status code 4.

### Important!

**Remember, you are only deferring payments not moving the maturity date.**Your loan will continue to accrue interest, this is not be capitalized on the loan. You will need to reamortize their loan when the deferment period is up. **This will cause their payment to INCREASE!** Depending on the size of the loan, it may take a while for them to catch up on the accrued interest.

*If you have questions do not hesitate to contact me at [rob@sbaworks.com](mailto:rob@sbaworks.com) or [lowerym@sbaworks.com](mailto:lowerym@sbaworks.com)

[View full post](https://blog.ffbf.com/properly-documenting-sba-7a-loan-deferments)

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