Back to all news

Federally Guaranteed Loans for Small Businesses – Applications Start April 3rd – Get Prepared NOW!

Services: Tax

The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed on March 27th and designed to help stimulate the US economy in light of the current global pandemic. $349B has been set aside for the Small Business Paycheck Protection Program (PPP) which is aimed at helping US small businesses keep workers employed via job retention loans. These loans will be eligible for partial or full forgiveness as long as the funds are used to keep employees on the payroll and for certain other expenses.

This money will not last long, so if your company is eligible, it will be important to apply quickly and be prepared when you apply so that it will be approved. Treasury and the Small Business Administration (SBA) plan to have the program ready for applications this Friday, April 3rd. The goal of Treasury and the SBA is for a company to go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved on the same day. Other companies are already getting in line with their lenders so it is important to secure your spot with your lender and quickly get your application in order, so that you are eligible to apply, you are with the front of the pack. This will increase your chances of the funds still being available if your loan is approved.

Who is eligible?

 

What are the terms of the loan?

Maximum Interest rate of 4% No collateral
Maturity of 2 years No personal guarantees
First payment deferred for six months No borrower or lender fees payable to SBA
100% guarantee by SBA  

 

When do you apply?


How much can you borrow?

Where do you apply?

 
The Treasury Department just released guidance for the Paycheck Protection Program on March 31, 2020 and we expect the funds to be highly sought after. Therefore, we recommend that you move quickly to apply for these funds. As always, we are here to help.

Hughes Pittman & Gupton, LLP