Coronavirus disease has swept the nation causing a pandemic spread throughout the world. It causes flu like symptoms, such as, but not limited to: respiratory illnesses, shortness of breath, fever, and cough. According to the CDC, the United States has over 186,000 cases and over 3,600 deaths. These numbers are foreseen to grow as government, healthcare, and scientists try to find a solution to eradicate the disease. 

Across the nation, many Americans are facing detrimental impact on their finances. Companies from small businesses to large, mega corporations have all taken a hit causing them to seek and ask for financial assistance. The Department of Labor, stated that over 3.2 million Americans have applied for unemployment and the numbers will rise as more and more businesses are shutting down. Congress has recently passed a $2 trillion stimulus that will assist workers, businesses, and industries. The government and banks are also offering low interest rates and long-term plans to keep small businesses afloat. Small Business Loan Advisor can help you get the loans needed for your business and get the maximum amount.

Who Can Apply for the COVID-19 Disaster Loans and Grants?

Currently, anyone who owns a small business and non-profit, private organizations in the United States and/or territories can apply for a loan with low-interest rates and/or receive up to $10,000.

Is My Business Considered a Small Business?

Your business needs to meet the Business Administration’s size standards. The business must provide certain records to see if they meet the size standards.

Economic Injury Disaster Loan and Emergency Economic Injury Grants

The Small Business Administration’s EIDA (Economic Injury Disaster Advance) Loan will work with small businesses that have up to $2 million of capital loans to help with their loss of income/revenue that has been lost temporarily due to COVID-19. When the application has successfully been filled out, the funds would provide up to $10,000 and would be available within three days. The loan advance being received will not have to be reimbursed or paid back under any circumstances. In order to access the advance, the individual must fill out the Economic Injury Disaster Loan first, then request for the advance. These loans and/or grants can be sued for the following:

  • Payroll
  • Sick leave for employees
  • Production costs due to disruption in the supply chain
  • Debts, rent, and mortgage payments

The Emergency Economic Injury Grant is available until December 31, 2020.

COVID-19 Economic Injury Disaster Loan Requirements

The application deadline is 9/30/2020. When the application is submitted properly and successfully, the information provided will be reviewed and determined if the individual qualifies for an economic injury loan. All documents and/or information requested must be filled out in its entirety or the loan may be rejected and cannot be processed. In order for eligibility, you must be qualified for one of the following:

  • Business does not have more than 500 employees
  • Individual operates as a sole proprietor, regardless of employees or not, and/or as an independent contractor.
  • No more than 500 employees if you are a cooperative.
  • Individual defined under the 15 U.S.C.632 is an ESOP (Employee Stock Ownership Plan) and does not have more than 500 employees.
  • Individual defined under 15 U.S.C. 657a(b)(2)(C) is a tribal small business and does not have more than 500 employees.
  • A business, that is small and accordance to the SBA Size standards, which includes agricultural or producer cooperative, aquaculture enterprises, and nurseries.
  • If the business has more than 500 employees, it must be considered small under the SBA Size Standards.
  • A non-profit, private organization that is not associated with a government agency or has an effective tax exemption letter from the IRS under sections 501(c),(d), or (e) of the Internal Revenue Code of 1954. If a tax exemption letter cannot be provided, there must be sufficient evidence from the State that the organization is non-profit or is conducting business under State law, or is faith-based.

However, all applicants must have ALL be able to have all criteria below in order to be eligible:

  • Under Federal guidelines, the individual must not be involved in any illegal activity.
  • Individual with 50% or more ownership interest is not past due on child support for more than sixty days.
  • Individual is not part of in involved in an agricultural enterprise. (this does not include aquaculture enterprise, agricultural cooperative, or nursery)
  • Individual does not present live exhibitions of a lewd sexual nature or determine directly or indirectly more than the minimal gross income through the offer of items or administrations, or the introduction of any delineations or presentations, of a lustful sexual nature.
  • Legal gambling activities does not exceed more than one-third of the annual gross income.
  • Individual’s business must not be associated with lobbying.
  • Individual is not a state, local, or municipal government entity.
  • Individual must not be a member of Congress.
  • Business must have been operated since January 31,2020.

Federal Disaster Loans

Federal Disaster Loans offer low-interest rates for small businesses that have been impacted by the coronavirus (COVID-19). The Disaster Assistance from the Small Business Administration (SBA) will work with the state Governor to request for loan assistance. The loan received can be used for the following:

  • Payroll
  • Fixed debts
  • Unpaid bills due to the disaster

The current interest rates for small businesses are 3.75% and 2.75% for non-profit organizations. In order for payments to be within reason, The SBA will offer long-term repayments for up to thirty years. This will be determined individually based on the ability to repay.   

Small Business Debt Relief Program 7(a), 504, and Microloans

Small Business Debt Relief Program will assist with small businesses with immediate relief with microloans and non-disaster SBA loans. SBA will usually cover loan payments up to six months. A portion of the risk will be shared by a bank with SBA. Businesses must meet the following standards:

  • Size standards according to the Small Business Administration
  • Located in the United States
  • Must be able to repay the loan
  • Have a sound business purpose

The 7(a) loan can provide businesses an affordable loan up to $5 million. This would be ideal for businesses who lack credit and would need the following:

  • Flexible financing
  • Buying an existing business
  • Short or long-term working capital
  • Currently has business debt and needs to refinance
  • Purchasing inventory or supplies
  • The loan must not be made under the Paycheck Protection Program, 504 loans, and microloans.

The 504 loan can provide businesses a loan up to $5.5 million with a fixed, long-term rate. Typically, interest rates are fixed and lower than the market rates. This would be ideal for businesses who would need the following:

  • Purchase real estate
  • Purchase buildings
  • Purchase machinery

The microloan program can provide businesses a loan up to $50,0000 for small businesses and non-profit childcare centers. Mission-based lenders are usually involved in these types of loans. This would be ideal for businesses who would need the following:

  • Start up and expansion

Which Disaster Relief Program is Right for Me?

On March 27, 2020 Congress passed a stimulus bill, called the CARES Act, that would provide relief to businesses and individuals that were affected by the coronavirus (COVID-19). How do you know which program would be right for you? Here are some guidelines that can help you choose the correct program:

  • Paycheck Protection Program: Provides capital to help assist the cost of keeping employees
  • Emergency Economic Injury Grant: A quick and small amount of cash to assist you immediately.
  • Small Business Debt Relief Program: If you have currently or may potentially have SBA loans and are afraid to keep up with your payments.

Contact Small Business Loan Advisor to Get Your Disaster Relief Loan

Are you struggling to get started on your disaster relief loan applications? You need experts, like Small Business Loan Advisor to not only help you every step of the way, but to give you that piece of mind. There are a lot of documentations and filing that you will need to do that might seem overwhelming.

Contact Small Business Loan Advisor at 888-919-1210 to get you on the right track and get you the loan you need faster.