Small Businesses Need Business Loans to Survive the Covid-19

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Small Businesses Need Business Loans to Survive
the Covid-19
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If youre among those small business owners that
need financial assistance because of the current
coronavirus pandemic, you can apply for
a business loan via the Small Business
Administrations loan program. The president of
the United States has advised the SBA to made
low-cost capital available to small businesses
through the Economic Disaster Injury Loan
program. Trump also asked Congress for an
infusion of 50 billion in loans for
businesses. Most states have declared disaster
due to the coronavirus pandemic and all affected
businesses in that State can apply for business
loans via the Economic Injury Disaster Injury
Loan (EIDL) funds.
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SBA Coronavirus Disaster Loan Program
With the SBAs Economic Injury Disaster Loans of
up to 2 million, small businesses can offset
their temporary revenue losses because of
coronavirus disaster. For non-profits, the
interest rate is 2.75 on EIDLs and 3.75 for
small businesses that have adequate cash
available or can get funding from other sources
to cover the costs at the loan terms of 30 years
max. The repayment terms are typically based on
the borrowers loan repayment ability. SBA
directly lend the EIDLs to small business owners.
Usually, the SBA does not lend loans directly to
small businesses. The SBA partially guarantees
loans that are made by their network of lenders
through their SBA 7(a) and 504/CDC loan
programs. The SBA has made interest rates lower,
and the legislation that advances funding to the
SBA will perhaps make these loans even more
affordable and widely available.
March 2020
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How to Apply for Coronavirus Business Loans?
March 2020
The process of applying for Coronavirus business
loans via the SBA is as follows The Economic
Injury Disaster Loan assistance by the SBA to
extend loans to small businesses, private
nonprofit, homeowners and renter organizations in
elected areas of a state to help relieve economic
damage caused by the coronavirus pandemic. The
SBA Office of Disaster Assistance will interact
with the states administrator to submit the
application for the Economic Injury Disaster
Loan.
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How to Apply for Coronavirus Business Loans?
March 2020
The information on the process of applying for
Economic Injury Disaster Loan will be provided to
the affected communities along with updated on
the SBA.gov/disaster after the declaration is
made for designated States areas. With that
said, if you need funding youve to ask your
State governor who will officially request SBAs
Office of Disaster Assistance to obtain the funds.
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How to Apply for Coronavirus Business Loans?
March 2020
For more information on the disaster loan
program, and to check the listing of your state
on the Declarations list, please visit the SBA
disaster assistance website at SBA.gov/Disaster. I
n order to stay current on the availability of
funds, follow the SBA website, Disaster Loan
Assistance website, and contact the disaster
service center at 1-800-659-2955 or email
at disastercustomerservice_at_sba.gov
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The Details Coronavirus Business Loan Program
Congress is still adjudicating on how to
distribute the 50 billion request made by
President Trump to small business owners. The
accurate details on how these EIDLs will vary
from typical EIDLs for other disasters still need
to be assessed. It is likely that business
funding for affected businesses by COVID-19 will
come from other SBA loan programs. According to
Senator Marco Rubio, the IMPACT for Small
Businesses Act of 2020 would include authority
for 50 billion in loans through the SBA 7(a)
loan program for the rest of the financial year
2020, with provisions including (via NAGGL)
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The Details Coronavirus Business Loan Program
Waiving upfront guarantee fees irrespective of
loan size for all borrowers Waiving the lenders
ongoing fee Increasing SBA 7(a) loans guarantee
up to 90 Increasing Express maximum loan amount
to 1 million from 350,000, and after 1 year,
lowers the maximum loan amount to 500,000 rather
than the existing 350,000. Increasing
flexibility to the Economic Injury Disaster Loans
(EIDLs)
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The Details Coronavirus Business Loan Program
With this added flexibility and guarantee,
lenders are more likely to extend financing to
small businesses, and waiving of fees will make
the loan process inexpensive for small
businesses. For funding up to 350,000, the
legislation would also not require the borrowers
to submit tax returns, making credit availability
easier as well. The bill has not passed yet, but
businesses could still apply for funding through
the EIDL program.
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The Details Coronavirus Business Loan Program
According to The SBA Business Stabilization
Direct Loan Program Act of 2020, SBA can make
no-interest business loans to affected businesses
directly with repayment terms under 10 years and
would not be denied due to inadequate
collateral. Keep in mind that the bill hasnt
passed as of in writing, and details are subject
to change.
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In order to apply for EIDL funding, counties are
required to provide documentation on local
businesses that have been affected by the
Coronavirus pandemic to speed up the approval
process.Washington State has started providing
the SBAs Estimated Disaster Economic Injury
Worksheet for businesses form on their
websites. Review this Washington information
sheet to acquire information on how to submit
this form. You can also check the availability of
this form with your state and county websites.
County officials will be assigned to submit these
forms when requesting an EIDL declaration.
Expediting the Process of Coronavirus Business
Loan
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The Bottom Line

• The influence of the coronavirus pandemic on
  small business community and society is rising
  daily. It still needs to figure out when things
  will settle down, and meanwhile, small businesses
  need every little assistance in the form
  of coronavirus business loans they can get to
  prevent the injuries felt by COVID-19.