Free Money Programs for Small Businesses
It looks like right now there's free money out there for real estate agents, lenders, and small business owners. So if you're one of those people, this actually applies to you.
There is hope and financial help available right now. I wanted to let you know about some of the programs that are out there to help support all of us through these trying times. Please note that I am not an attorney, a CPA, or an accountant. You're gonna have to verify all this information. I am just relaying the information read to me by my trusted advisors.
The CARES Act
With the passage of the CARES Act on Friday afternoon, there is finally some relief for small business owners. While the bill is a thousand-plus pages, there are two key provisions that we really wanna make sure that you're aware of as soon as possible. They are both SBA-related and should help most small business owners. The SBA is offering an economic injury disaster loan. This is a $10,000 loan advance that will not have to be repaid as long as it used for economic relief due to COVID-19.
The SBA has streamlined the application process so it can be all done online and it only takes about 10 minutes to do. The online application is right on the link right below, so be sure to write that down. According to my CPA, in addition to the $10,000 available to you upfront, you can apply for up to $2 million dollars in additional funding. The rate of these loans will not exceed 4% and can be spread over a 30-year term. Currently, the only portion of this loan that will be waived or forgiven is the initial $10,000 and, of course, this could be subject to change, so be sure to look into all the fine lines and details.
Payroll Protection Program
The second loan offering is called the Payroll Protection Program, the PPP, and there are components of this loan that can be forgiven, so listen up. Congress has allotted $349 billion to this loan offer. These loans are considered SPA7 loans and they're applied directly through your bank or credit union. Here is a brief synopsis of this loan program. Businesses that can apply. Any business with 500 or fewer employees. The business does not have to be shut down completely or partially. Any business that applies is presumed to need the loan and will get it. That's good news. The only underwriting standards are the company was in business on February 15th, 2020, and had employees for whom it paid salaries and payroll taxes.
These loans are non-recourse, meaning no personal guarantees or liens on business assets.
The maximum loan amount will be equal to 2.5 times the average payroll cost during the one-year period before the loan is actually taken. The portion of the loan that can be forgiven is equal to the sum of the employer's, A, payroll costs, B, interests not principal on any business debts that were incurred prior to February 15th, 2020. C, rent, and D, utilities including electricity, gas, water, transportation, telephone, and internet access.
These types of items can be forgiven, which are incurred during the eight-week period that begins on the origination date of the 7a loan. Now more than ever we have to get this message about these loans out, so please do me a favor. Share this video with anyone who is a small business owner. It may be a local professional that you know. A candy store, a T-shirt maker, a real estate agent, or a lender. It can be just about any small business owner out there. They quality for these types of loans.
Free Money Programs for Small Businesses
There is hope, there is help, and we are all gonna get through this. Now, remember, I am not a CPA or an accountant, or an attorney. You're going to have to do your own due diligence on these, but as always, I'm here to help and I look forward to serving you in the future.
Hope this was helpful to you.
