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COVID-19 Small Business Assistance Programs

There are basically 2 programs underway to give financial help to small businesses being impacted by the COVID-19 pandemic either by forced closure from state and local mandates or economic injury because of decreased business.   

Here is a basic outline of the programs and who to contact to get details and start the application process:

Paycheck Protection Program (PPP)

The Paycheck Protection Program (“PPP”) authorizes up to $349 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis.  All loan terms will be the same for everyone. The loan amounts will be forgiven as long as: 

  • The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8-week period after the loan is made; and 

  • Employee and compensation levels are maintained.  Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to the likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs. 

  • Loan payments will be deferred for 6 months.   

When can I apply?  

Starting April 3, 2020, small businesses and sole proprietorships can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.   
Starting April 10, 2020, independent contractors and self-employed individuals can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.   
Other regulated lenders will be available to make these loans as soon as they are approved and enrolled in the program. 

Where can I apply? 

You can apply through any existing SBA 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. Visit www.sba.gov for a list of SBA lenders.  

How much of my loan will be forgiven?

You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent, and utility payments over the 8 weeks after getting the loan. Due to the likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs.    

You will also owe money if you do not maintain your staff and payroll.

 

Local Participating Lenders Include:

Citizens National Bank
325-643-3545

MC Bank
Bobby Martin
325-646-3131

TexasBank
325-649-9200

Talk to these lenders, or your current lender, to find out what documentation they will require for the application and to get more details regarding the program.  

 


Economic Injury Disaster Loans and Loan Advance

This loan program is directly through the SBA and borrowers must apply directly through the SBA website.   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 SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%.

The SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.

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 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.  Visit https://www.sba.gov/disaster-assistance/coronavirus-covid-19 for more details of the program. 

To apply for a COVID-19 Economic Injury Disaster Loan, click here.

 

To view our comprehensive list of additional COVID-19 resources view here. 

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