A Signed Written Explanation of Offense is required if the borrower has any criminal history. This document allows the borrower to explain the circumstances of the offense, including how it was resolved. It helps funders understand the situation and how the borrower has moved forward, ensuring a fair loan evaluation. The SBA uses it, along with a credit assessment, to evaluate the guarantor's character and reputation.
This document should include:
Details of the offense: A description of the offense and its circumstances, including any pertinent court documents.
How it was resolved: How the issue was addressed, including legal outcomes or any corrective actions taken.
This explanation helps the funder assess the borrower’s background and determine how it may affect the funding decision.