How to qualify for COVID-19 CARES Act loan and grant options
There are many ways that companies will be able to tap into federal assistance through the CARES Act. It is important to note that all sectors are urging federal agencies to expedite their regulations to ensure impacted businesses can access loans immediately and processes will evolve. More detailed application guidelines are set to come up by the end of the week.
Assuming that that happens we will schedule a call next week to review the process and answer any questions you may have. We will continue to seek more specific information and provide it as it becomes available.
In general note…
- There are several different SBA loan programs that appear will be available. One key program is called the “Paycheck Protection Program” and was put in place by the CARES Act.
- The loans will be issued by banks as part of the existing SBA 7(a) loan program, so applications will be done through a bank.
- Some medium-sized businesses that are normally not eligible for SBA loans may be eligible for these PPP loans. The CARES Act makes them available to all businesses with 500 or less employees eligible, even if they aren’t eligible for normal SBA loan programs.
- The PPP loans will have have forgiveness built in , specifically the amount spent on operating expenses during an 8-week period after the loan is received. Payroll, rent, utilities, mortgage interest are all part of the formula.
