We are all in the midst of a challenge that we have never seen before, but fortunately, the government is acting quickly to help small businesses navigate these rough waters and stay afloat!
So the $50 Billion Economic Injury Disaster Loan (EDIL) program that was approved this last week was established to help businesses recover from disasters that have caused them to suffer from economic damage and help replace lost revenue to help them recover during the rebuilding process.
1. Businesses can receive up to $2 million for up to 30 years.
2. Funds can be used for-
-Loss of revenue
-Fixed debt payments
-Payroll for employees
-Dealing with accounts payable
-Other bills that cannot be paid due to the crisis
3. These loans carry a 3.75% interest rate for for-profit companies and 2.75% for non-profit companies
4. There is NO forgiveness program for the EIDL program.
5. The SBA will stick to their same creditworthiness guidelines for approvals of the EDIL- must have a 640 FICO or higher.
6. The processing of these loans is expected to take 3-4 months. They are working to make this quicker, but advise that you be ready to exercise patience!
7. Because of the long delays, they are offering a quick $10K payout that you can receive within 3-5 days of them receiving your application.
8. They have said to expect about 40-60% of the amount you request to be approved.
Paycheck Protection Program
$350 Billion has been approved for the PPP which will be launched this coming Friday!!! This program is to help you retain your employees during this time. This money will allow you to pay your employees and keep them on stand by so that when the country and your business are ready to open back up, they will be ready!
Who is eligible?
-Businesses with less than 500 employees per location
-Gig economy workers
Where can you apply?
At any SBA approved lending institution
How much are you eligible for?
250% of your average monthly payroll up to $10 million. This is to cover 8 weeks of payroll and debt obligations.
The PPP will not use your FICO score to approve you! Approvals will be based on # of employees and the amount of your payroll.
This money should be available to you within 24-72 hours after your application is received and approved!!!
You can use a 12 week period from your 2019 payroll to determine your payroll expenses!!!
I have been told that I will have links for both programs to help you get your application and paperwork submitted as quickly as we can sometime today or tomorrow! Please feel free to reach out if you have questions or need some guidance for your business! We are always here to help!!!
This is what we know for now! I feel like this will be very helpful for business owners to keep us all in business! I will keep you all updated on any changes that we hear in the next few days!