According to the US Small Business Administration, the federal paycheck protection program provided small business owners with a little less than $ 800 billion in COVID-19 bailouts.
PPP ended May 31st, but as companies move the recovery process forward, they may find an ongoing need for affordable financing. Here are some of the government funding options that are still available and how to get them.
COVID-19 Economic Injury Disaster Loan
If your business loses money as a result of a pandemic, you may be eligible for a COVID-19 Economic Injury Disaster Loan. The SBA may issue these loans until December 31, this year, or until the funds run out, whichever comes first.
New changes to the program increase the maximum available loans from $ 500,000 to $ 2 million, extend the deferral period for all loans to 24 months, expand the use of funds and non-federal And federal debt payments are now included.
The COVID-19 EIDL is funded directly by the SBA, but unlike PPP loans, it cannot be forgiven.
However, companies in the low-income community may be eligible for a COVID-19 EIDL prepayment of up to $ 15,000 that does not require repayment. Business owners can pay in advance without getting a loan.
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COVID-19 EIDL is SBA Online Portal — And if your business is eligible for prepaid, the SBA will contact you directly to submit your application.
Not limited to pandemic bailouts, SBA 7 (a) loans can provide eligible companies with affordable long-term funding.
7 (a) A recent update to the loan program has exempted prepaid guarantees for loans of less than $ 350,000 valid until September 2022. The maximum SBA Express Loan funding — offers a shorter travel time than a standard 7 (a) loan — is also permanently set at $ 500,000 from $ 350,000 before the pandemic.
However, any type of SBA 7 (a) loan may require sufficient credit, strong earnings, and years of business to qualify.
Jody Rasbun Briggs, senior vice president and chief lender of the Greylock Federal Credit Union in Pittsfield, Massachusetts, said some companies faced challenges in the past due to pandemics. He said in an email that he couldn’t show it.
“The borrower should have a well-thought-out recovery plan and discuss those plans thoroughly with the banker,” she said.
NS SBA offers creditor matches A tool on the website to connect potential borrowers and lenders within 2 business days. You can also contact a local bank in your community or an existing bank to see if an SBA 7 (a) loan is available.
Local loans and grant programs
States and cities continue to implement their own COVID-19 relief programs and are rolling out new programs. For example, the city of Chicago recently announced the launch of the Chicago Creative Worker Assistance Program, which has allocated a $ 2.3 million grant to artists and creative workers who have lost their income due to a pandemic.
Similarly, the California Rebuilding Fund has provided loans to more than 700 SMEs and announced an additional $ 56.5 million in available capital in September. The program provides low-interest loans to qualified businesses throughout the state and distributes them through a network of community lenders.
In general, community lenders such as community development financial institutions and CDFIs are excellent for affordable financing, especially for traditionally underserved businesses such as low-income areas, minority-owned businesses, and women-owned businesses. This is an option.
Randell Leach, CEO of Beneficial State Bank, a CDFI based in California, Oregon, and Washington, says it’s worth considering CDFI from both geographic and sectoral angles. For example, if you’re a natural food store, you’re likely to find a CDFI focused on it, he says.
Employers can search state or city government websites and contact local representatives or industry groups to find potential grants and lending programs in their area. To find a CDFI in your area, or a CDFI that may be relevant to your business sector US Treasury Community Development Financial Institutions Fund Website.
Organizations such as SCORE and the local SME Development Center also provide access to free recovery resources to help business owners identify potential financing opportunities.
Don’t forget to forgive PPP
Over 11 million PPP loans have been approved and as of October 3, there are approximately 7.5 million applications. Forgiveness of PPP loan Submitted, according to the SBA.
Loan forgiveness does not provide additional funding for your business. But it ensures that you can spend the money you already have on expenses rather than paying for PPP loans. If you receive a PPP loan, you must apply for forgiveness by the loan maturity date.
This article was provided to The Associated Press by the personal finance website Nerd Wallet. Randa Kriss is a writer for Nerd Wallet. Email: firstname.lastname@example.org..
NerdWallet: PPP Loan Forgiveness Guide: https://bit.ly/nerdwallet-ppp-guide
COVID-19 Financial Injury Disaster Loan Application: https://covid19relief.sba.gov/#/
SBA Lender Match: https://www.sba.gov/funding-programs/loans/lender-match
List of Certified CDFIs: https://www.cdfifund.gov/faq
Copyright 2021 AP communication. all rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
PPP is gone, but government support for SMEs is gone | Lifestyle
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