During this unprecedented time, we are experiencing challenges on every front affecting our health, our economic viability, and even our ability to obtain essential goods.
The Coronavirus Aid Relief and Economic Security (CARES) Act allocated $350 billion to help small businesses keep their employees working. The Paycheck Protection Program (PPP) provides 100% federally guaranteed loans to small businesses. To apply for this loan, small business owners must apply at a bank.
In addition, the Small Business Administration (SBA) is offering Economic Injury Disaster Loans (EIDL) to small business owners which includes an advance of up to $10,000. Applications for this loan are submitted online directly to the SBA.
We are hearing from small business owners across our county about their concerns regarding the responses they are receiving from banks and the SBA. There is much confusion, delayed or no responses, and even some banks who are unable to accept additional applications. Small business owners are frustrated, scared, and they do not know where to turn.
Knowing this doesn’t lessen concern about getting needed help. Here are a few thoughts as you work through this:
Take a deep breath and take some time to read the material available on both loan programs to understand how they work so you can make the best decision for your business. You’ll find some resources on the Chamber’s website to help.
Gathering any needed documentation including up-to-date financial reports in advance is helpful to you and your banker. The more prepared you are, the better.
To decide which loan program(s) work best for your business, this infographic will give you a quick overview. We have recorded virtual meetings on our website that will provide you with more specifics. We also encourage you to talk with your accountant to get advice specific to your business.
The application for the EIDL loan package is on this website. It’s a simple 3-page application that takes about 15 minutes to complete. Have your personal and business info ready – EIN, and the past 12 months gross revenue, cost of goods sold, and operating expenses. Current experience is that you will receive a confirmation number immediately (keep it on file); however, at this time the advance is not being deposited within three days and responses from the SBA are delayed. They are working on this – know that it will take some time.
To apply for the PPP loan program, you’ll need to contact a banker. You’ll find a list of banks on the SBA website. To help you prepare to apply, you may find this Small Business Guide and Checklist helpful as well as this sample loan application. Know that banks are overwhelmed with calls, questions, and applications. It may take longer than in the past for your banker to assist you.
Though following these steps will not ensure immediate responses, it will place you in the best position possible. Understanding the process, having your questions ready, having documentation gathered, updating your financials, and approaching this in a professional manner will go a long way to helping you get the help you need.
If the Chamber can assist you during this time, please reach out to us. Above all, please take care of yourself during this time.