Breaking News April 1, 2020 9:00 am
The U.S. Department of the Treasury has released more information about the Paycheck Protection Program here:
SMALL BUSINESS PAYCHECK PROTECTION PROGRAM
The Paycheck Protection Program provides small businesses with funds to pay up to 8 weeks of
payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and
Funds are provided in the form of loans that will be fully forgiven when used for payroll costs,
interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the
forgiven amount must have been used for payroll). Loan payments will also be deferred for six
months. No collateral or personal guarantees are required. Neither the government nor lenders
will charge small businesses any fees.
Must Keep Employees on the Payroll—or Rehire Quickly
Forgiveness is based on the employer maintaining or quickly rehiring employees and
maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if
salaries and wages decrease.
All Small Businesses Eligible
Small businesses with 500 or fewer employees—including nonprofits, veterans organizations,
tribal concerns, self-employed individuals, sole proprietorships, and independent contractors—
are eligible. Businesses with more than 500 employees are eligible in certain industries.
When to Apply
Starting April 3, 2020, small businesses and sole proprietorships can apply. Starting April 10,
2020, independent contractors and self-employed individuals can apply. We encourage you to
apply as quickly as you can because there is a funding cap.
How to Apply
You can apply through any existing SBA 7(a) lender or through any federally insured depository
institution, federally insured credit union, and Farm Credit System institution that is
participating. Other regulated lenders will be available to make these loans once they are
approved and enrolled in the program. You should consult with your local lender as to whether
it is participating. All loans will have the same terms regardless of lender or borrower. A list of
participating lenders as well as additional information and full terms can be found at
BE AWARE: There are stories of bad actors promising to acquire SBA EIDL and PPP Loans/Grants on your behalf. The U.S. Treasury and the SBA directs small businesses to consult with their regional SBA (in our case the Richmond SBA) and SBDC offices for assistance.
The Valley SBDC still thinks this is the best site to go for information:
Loan Details and Forgiveness
The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.
Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.
This loan has a maturity of 2 years and an interest rate of .5%.
If you wish to begin preparing your application, SAMPLE Paycheck Protection Program Application_4_1_20 to see the information that will be requested from you.
A list of Virginia Based SBA Preferred Lenders VA SBA Lender_Ranking_FY20_FEB_29byTotal
The SBA considers whether the lender:
Has the ability to process, close, service and liquidate loans
Has the ability to develop and analyze complete loan packages
Has satisfactory SBA performance
Updated March 30th, 2020 9:00 am
Please see the latest page for eligible entity verification for the EIDL here.
The CARES Act Guide is a downloadable PDF from the U.S. Senate Committee on Small Business & Entrepreneurship and outlines the latest programs:
Paycheck Protection Program Loans
Small Business Debt Relief Program
Economic Injury Disaster Loans and Emergency Economic Injury Grants
Additionally, there is new information on a $10,000 Loan Advance:
In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000.
The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. The loan advance 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 application, and this loan advance will not have to be repaid.
This is the main SBA page for a review of all the programs: www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources
Keep in mind while you are deciding if you should apply for any SBA Loan:
Credit History – Applicants must have a credit history acceptable to SBA.
Repayment – SBA must determine that the applicant business has the ability to repay the SBA loan.
Eligibility – The applicant business must be physically located in a declared county and suffered working capital losses due to the declared disaster, not due to a downturn in the economy or other reasons.
Working capital loans may be used to pay fixed debts, payroll, accounts payable, and other bills that could have been paid had the disaster not occurred. The loans are not intended to replace lost sales or profits or for expansion.
Please know this:
Business Advisors with the Shenandoah Valley Small Business Development Center will be available to help Small Businesses, Sole Proprietors and eligible Non-Profits apply for the EIDL and refer you to resources for the Paycheck Protection Program, Emergency Economic Grants, and other funded SBA debt relief programs. We encourage you to contact us via email: email@example.com and if you are not a current SBDC Client, to fill out the Request for Counseling form. While our offices at the JMU Ice House are temporarily closed to the public, we are monitoring and returning phone calls, emails and Request for Counseling forms. We may not be able to meet with you face-to-face today, but we are preparing quickly with the tools technology to help you online in the meantime!
Additionally, the Virginia SBDC Network has compiled resources for business owners with several links here: https://www.virginiasbdc.org/resources/
Counseling & Training: (from the CARES Act) If you, like many small business owners, need a business counselor to help guide you through this uncertain time, you can turn to your local Small Business Development Center (SBDC), Women’s Business Center (WBC), or SCORE mentorship chapter. These resource partners, and the associations that represent them, will receive additional funds to expand their reach and better support small business owners with counseling and up-to-date information regarding COVID-19. There will soon be a joint platform that consolidates information and resources related to COVID-19 in order to provide consistent, timely information to small businesses. Your VAlley SBDC has Business Advisors ready to answer individual questions and assist you in the process of applying for these programs. Please fill out our Request for Counseling and our Office Manager Roise Riggleman, our Director Joyce Krech or other Business Advisors on staff will contact you as soon as possible.
For more Business Resources and Government Agency links, Click Here