Paycheck Protection Program Application Process Update
The Small Business Administration (
SBA.gov
) announced that the much anticipated Paycheck Protection Program Loans would roll out on Friday, April 3rd. However, there has been some confusion over the process for application, forms to use, and how long it will take before funds are distributed. The Chamber is following the situation closely to provide members with the most up-to-date and accurate information available. However, since details change daily, we urge you to check the Chamber's Coronavirus Resource page often for updates.
Who is Taking Applications
Applications for the Paycheck Protection Program will be handled through any existing SBA approved 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating.
Additional regulated lenders will be available to make these loans once they are approved and enrolled in the program.
Many of the Chamber's lending institution members are participating in the Paycheck Protection Program. Several of them are currently accepting applications, and several others are finalizing their internal processes to be able to accept applications.
Where Can I Get an Application
Please be aware, that individual lenders, may have a preferred form or require additional documentation. There are also some lenders who are taking applications over the phone to protect their employees and customers from exposure to Coronavirus. You are best served to contact your preferred lender directly to learn about their procedure.
Who Can Apply
This program is for any small business with less than 500 employees (including sole proprietors, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by coronavirus/COVID-19.
Businesses in certain industries may have more than 500 employees if they meet the SBA’s size standards for those industries.
Small businesses in the hospitality and food industry with more than one location could also be eligible if their individual locations employ less than 500 workers.
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 1%.
When to Apply
Starting Friday, April 3, 2020
, small businesses and sole proprietors 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.
Additional COVID-19 Small Business Guidance and Resources
