Updated April 13, 2020 -We will continue to update this information as more guidance is provided.
To help small businesses during this time of economic trial, the Small Business Administration has enacted three different programs.
To be eligible, the entity must have been in operation on 2/15/2020 and must be considered “small” based on NAICS code either revenue or staffing numbers. Nonprofit organization are also eligible if they meet specific guidelines. Generally, entities with not more than 500 employees will be eligible if they are under the revenue threshold.
SBA size standards can be found here:
https://www.ecfr.gov/cgi-bin/text-idx?SID=b919ec8f32159d9edaaa36a7eaf6b695&mc=true&node=pt13.1.121&rgn=div5#se13.1.121_1201
https://www.sba.gov/size-standards/
Following is a summary of the loan programs available.
Payment Protection Program (PPP) Loans -
Guidance from the SBA regarding these loans, continues to be issued.
SBA Economic Injury Disaster Loans (EIDL)
SBA Express Bridge Loan
Other SBA loan products that may be available from SBA lenders:
SBA Express Loan
For more information: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources
Please contact us for more information on the programs under which your business may qualify or if you need assistance in compiling the necessary information to apply.
To help small businesses during this time of economic trial, the Small Business Administration has enacted three different programs.
To be eligible, the entity must have been in operation on 2/15/2020 and must be considered “small” based on NAICS code either revenue or staffing numbers. Nonprofit organization are also eligible if they meet specific guidelines. Generally, entities with not more than 500 employees will be eligible if they are under the revenue threshold.
SBA size standards can be found here:
https://www.ecfr.gov/cgi-bin/text-idx?SID=b919ec8f32159d9edaaa36a7eaf6b695&mc=true&node=pt13.1.121&rgn=div5#se13.1.121_1201
https://www.sba.gov/size-standards/
Following is a summary of the loan programs available.
Payment Protection Program (PPP) Loans -
Guidance from the SBA regarding these loans, continues to be issued.
- Application is submitted through an SBA 7(a) approved lender.
- Sole proprietors and self-employed individuals are eligible.
- Loan size is based on monthly payroll costs
- Maximum loan is lesser of $10 million or 250% of average monthly payroll costs for the 12-month period prior to the loan (there are special rules for seasonal employers)
- Payroll costs including health insurance premiums, retirement benefits, and other specific amounts
- Employee compensation in excess of $100,000 is excluded (compensation does not include health insurance, etc)
- Proceeds may be used for payroll costs, health insurance premiums, rent, utilities, mortgage interest, or interest on other debt incurred prior to the covered period
- Forgiveness is available and can be obtained through application with the lender.
- Full loan can be forgiven, up to the sum of:
- Payroll payments made under the loan for 8 week period compared to the previous year
- Rent, utilities, mortgage interest
- Loan forgiveness is reduced proportionally based on reductions in staffing or compensation
- Loan payments are deferred for 6 months; however interest will accrue during this period. The interest rate on the loan is 1%. Any loan amount not forgiven must be repaid within 2 years.
- No collateral or personal guaranty required
- Assistance received disqualifies the business from the Employee Retention Credit and payroll tax deferral provisions.
- For more information regarding the forgiveness calculation, click here
- For FAQ's on the PPP loan and other info, visit the Small Business Administration PPP website
SBA Economic Injury Disaster Loans (EIDL)
- Application is submitted online through the SBA website
- A $10,000 emergency advance is available within three days of applying for the loan. The advance does not need to be repaid under any circumstance.
- Loan amounts up to $2,000,000 for alleviating economic injury
- Proceeds can be used to pay payroll and other operating expenses
- Collateral is required
- Repayment ability (credit history) is required
- Loan terms are 3.75% maximum interest, 30 year maximum term.
- Additional information on EIDL loans from the Committee on Small Business
- Apply and get additional information here regarding the EIDL and emergency advance
SBA Express Bridge Loan
- Application is submitted through an SBA Express Lender with which the small business currently has a business relationship
- Maximum of $25,000 with fast turnaround
- Intended for small businesses with an urgent need for cash while waiting for a decision and disbursement on an EIDL
- Will be repaid in full or in part by proceeds from the EIDL loan
Other SBA loan products that may be available from SBA lenders:
SBA Express Loan
- This is a 7-year loan with a 36 hour turnaround
- Formerly $350,000, increased to $1,000,000 under the CARES Act.
For more information: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources
Please contact us for more information on the programs under which your business may qualify or if you need assistance in compiling the necessary information to apply.