Don’t Wait to Apply for your Small Business Association Payment Protection Program Loan
Because COVID-19 has so suddenly impacted businesses, and with many questions remaining concerning the duration of the pandemic, many are left wondering how they will be able to continue to operate, and where they will secure the money to continue operations. Fortunately, the United States government has passed the Paycheck Protection Program, through the Small Business Association, as part of its $2 trillion coronavirus stimulus bill.
What is the PPP Program?
The Paycheck Protection Program is essentially a guarantee by the U.S. government of a small business loan. In other words, a small business may apply for a PPP loan through a local lender, and the federal government provides additional security for that loan. That allows for minimal underwriting and quick approval. In addition, assuming the funds are used for approved purposes (primarily payroll, but some part may be used for rent,utilities, and other debt service), some or all of the loan may be forgiven!
How do I get money for my business?
The steps to secure a PPP loan for your business, including a database for searching for lenders, can be found here. The website provides details of the requirements, but among the advantages area low interest rate (1%), deferred payments for six months, and loan forgiveness if certain conditions are met.
Funds are Limited
As of April 16th, nearly all of the $349 billion allocated for the PPP has already been claimed. So, it is imperative to act quickly to secure a place in line for the PPP program. Even if you miss out on the first round of funding, having all of your documents in place will help if/when Congress allocates additional funds for the program.