COVID-19 Business Assistance For San Juan, Texas

What will lenders be Looking for?

In evaluating eligibility, lenders are directed to consider whether the borrower was in operation before February 15, 2020 and had employees for whom they paid salaries and payroll taxes or paid independent contractors.

Lenders will also ask you for a good faith certification that:

SMALL bUSINESS ADMINISTRATION PROGRAMS CURRENTLY AVAILABLE

Loan Forgiveness - Section 1106

This section lays out the process by which borrows will be forgiven on loans taken under the paycheck protection act

  • The amount of the loan forgiven at the end of the covered period will be determined by how many employees were retained on the company’s payroll.
  • There are safeguards built in to protect against employers gaming the program, and well as recognizing some employers will be forced to do temporary furloughs but bring their employees back on.
  •  Allows forgiveness for additional wages paid to tipped workers.
  • Forgiven amounts will not be considered income for tax purposes.
  • Any amounts not forgiven will be covered in the ongoing loan for a term of 10 years, not to exceed 4% interest with the 100% guarantee.   

Paycheck Protection Program (PPP) - Section 1102​

The bill establishes a new guaranteed loan program at SBA for small businesses to cover payroll during the immediate crisis. The Paycheck Protection Program would:

  • Support $349 billin in 100 percent guaranteed, low interest, no fee loans of up to $10 million with repayment deferred for at least six months: and
  • Forgive up to 100% of the loan if the borrower has retained the same number of employees as when they received the loan.

Small and Medium sized businesses up to 500 employees, non-profits, independent contractors and the self-employed. This includes churches but only to cover payroll costs of an associated business, like a thrift store.

The program temporarily waives SBA “affiliation rules” to allow businesses  with multiple locations the normally are not considered small, to qualify. This is especially important for our restaurant and lodging sector. They are still limited to the same maximum loan size – $10 million – as a business with one location. 

The SBA’s network of 2,500 7(a) lenders will be used to process these loans. There is also authority to fast track additional lenders to process and disburse these loans to reach as many small businesses as quickly possible.

Yes and No. The amount of the loan forgiven at the end of the year will be determined by how many employees were retained on the company’s payroll, up to 100 percent for full retention. There are safeguards built in to protect against employers gaming the program, as well as recognizing some employers will be forced to do temporary furloughs but bring their employees back on.

The program is open until June 30, 2020, as it is intended for immediate payroll relief to ensure businesses do not mass layoffs during this crisis.

It is nearly identical, we worked with the Senate to include more than just payroll in the loan amount.  The CARES Act now includes amounts already disbursed under a new EIDL loan from SBA. 

SBA Debt Relief

The SBA Debt Relief program provides a reprieve to small businesses as they overcome the challenges created by this health crisis.

Under this program:

  • The SBA will  also pay the principal and interest on new 7(a) loans issued prior to September, 2020
  • The SBA will pay the principal and interest of current 7 (a) loans for a period of six months.
  • See your 7(a) lender for details

Economic Injury Disaster Loan (EIDL)

In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eli=gible to apply for an Economic Injury Disaster Loan advance of up to $10,000.

  • The SBA’s Economic Injury Disaster Loan Program provides small business working capital loans of up to $2million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
  • The loan 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 app and this loan advance will not have to be repaid.
  • For loans $25K and less No cost apply.
  • For loans greater than $25k there is a $100 UCC lien filing and processing fee.
  • Amount is determined by SBA from your information.
  • No obligation to take the loan (if offered).
  • Existing SBA loans are okay.
  • Personal guarantee requirements 
    • non e if loan in under $200,000
    • If more than $200,000 then guarantee from all 20% or greater owner
  • Collateral
    • If more than $25,000 EIDL requires collateral.
    • SBA will not decline for lack of collateral, but requires the pledge of what is available.
    • Dosen not require primary residence in Texas.

SBA Express Bridge Loans

1.- Express Bridge Loan Pilot allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,00 with less paperwork. Loan is at SBA Express lenders discretion.

2.- These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan.

3.- if a small business has an urgent need for cash while waiting for a decision and disbursement on an Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.

COVID-19 Updates and Information for Businesses.

CONTACT

Orlando Hernandez
orlando@smktmedia.com
905 W. 1st St. Ste. D, San Juan, TX 78537