SBA loan programs to help your company survive COVID-19
Kapitus insights on the PPP
Need Immediate COVID-19 Relief? We Help Small Businesses Survive Difficult Times
The Federal Government is moving at a fairly fast pace to build and launch relief programs to help members of the small business community. The suggestions of what to provide have been many, and the changes in proposals and existing programs have been rapid, making it hard for businesses owners to keep up with and understand the federal resources available to them at this time.
Here’s What You Need To Know.
| CARES 7(a) PAYCHECK PROTECTION PROGRAM | ECONOMIC INJURY DISASTER LOAN (EIDL) 7(b) | STANDARD 7(a) | |
|---|---|---|---|
| ELIGIBILITY | – US based businesses – Operating on February 15th, 2020 – 500 or less employees, or the employee limit governed by NAICS code (300 employees for second draw) – Can certify economic impact due to Covid-19 (for second draw, defined as a 25% reduction in revenue in one quarter from 2020 over the same quarter in 2019) | – US based businesses – Economic hardship due to Covid-19 can be shown via a decline in revenue | – US based businesses (for profit only) – Minimum personal credit score of 680 – Establishment of business credit – Minimum of 2 years in business – Business is profitable |
| CALCULATION ON FUNDING AMOUNT | 2.5 X your prior average monthly payroll (3.5 X for the second draw of businesses with NAICS code beginning with 72) | Dependent on loss incurred due to Covid-19 | Dependent on application |
| MAXIMUM AMOUNT | $10,000,000 ($2,000,000 for second draw) | $150,000 | $5,000,000 |
| MAXIMUM TERM | No payment for the first 6 months Term up to 2 years (for second draw, no payment for the first 10 months. Term of 5 years) | Up to 30 years | Up to 25 years |
| MAXIMUM INTEREST | 1% | 3.75% | Prime + 3.7% (Current prime is 3.25%) |
| LOAN/PRINCIPAL FORGIVENESS | Yes | No | No |
| CAN BE COMBINED WITH | – Standard 7(a) loan (if obtained before 2/15/2020) – EIDL 7(b) loan | – Physical Disaster Loans with a maximum combined amount of $2,000,000 – CARES 7(a) Paycheck Protection Plan – Standard 7(a) loan | – EIDL 7(b) loan |
| CANNOT BE COMBINED WITH | – Standard 7(a) loan if obtained after 2/15/2020 – New Standard 7(a) loan application | – An existing CARES 7(a) Paycheck Protection Plan loan | |
| APPLICATION SUPPORTING DOCUMENTS | – Payroll documentation showing number of employees and amounts spent over last 12 months – 3 months of business bank statements – Transcripts from payroll taxes paid – For a full list of required documents please see our page on the Paycheck Protection Program | – Most recent Federal Tax Return – Year end profit and Loss statement – A current year to date Profit and Loss statement – Monthly break down of sales figures | – Business financials relevant to the past 90 days (balance sheet) – Debt schedule or purchase contract – Past 2 years of business tax returns – Past 2 years of personal tax returns |