diff --git a/optimum/habana/sentence_transformers/st_gaudi_trainer.py b/optimum/habana/sentence_transformers/st_gaudi_trainer.py
index b8f52b6e16..6f852ac924 100644
--- a/optimum/habana/sentence_transformers/st_gaudi_trainer.py
+++ b/optimum/habana/sentence_transformers/st_gaudi_trainer.py
@@ -263,6 +263,8 @@ def override_model_in_loss(self, loss: torch.nn.Module, model: "SentenceTransfor
         from sentence_transformers import SentenceTransformer
 
         for name, child in loss.named_children():
+            if _is_peft_model(child):
+                child = child.get_base_model()
             if name == "model" and isinstance(child, SentenceTransformer):
                 loss.model = model
             elif isinstance(child, torch.nn.Module):