The U.S. Small Business Administration (SBA) is now offering low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of COVID-19. These loans are available to small businesses, small agricultural cooperatives, small aquaculture businesses and most private, non-profit organizations. Both businesses directly and indirectly affected could be eligible for an SBA loan.
The Small Business Administration currently has two major loan programs in response to COVID-19.
All small business owners are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid. This loan is directly from the SBA via the Federal Reserve (meaning, no bank is involved).
To learn more about this program click HERE.
To apply, click HERE.
This program will be made available on Friday, April 3rd and will require a bank as an intermediary. This loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75 percent of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees. Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease. This loan has a maturity of two years and an interest rate of .5 percent.
To learn more about this program click HERE.
The Chamber’s Existing Industry Project Manager, Alex Warner, is available to walk any Forsyth County business owner through the application. Reach out to him at awarner@focochamber.org. Additionally, Alex has prepared a helpful tutorial video. To view this tutorial, click HERE. Another helpful tool from the U.S. Chamber of Commerce can be found HERE.
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