How Does COVID-19 Impact Your Small Business? SBA Disaster Loans and Relief

Covid-19 Loans

What Does This Stimulus Package Mean For Your Small Business?

In the midst of the global COVID-19 pandemic and the fastest increase of unemployment rates ever seen in the United States, the $2 trillion dollar Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), provides significant economic relief to small businesses. This article provides a detailed overview of the relief available to qualifying small businesses from the Small Business Administration (SBA).

REIL Capital is providing free consultations to help business owners apply for government assistance. Please click here to fill out and application and schedule a free appointment with a capital specialist.

Does your Small Business Qualify for Stimulus Loans?

Qualifying businesses that have suffered significant disruptions will be able to receive no fee and low fee small business interruption loans for in the form of (i) Economic Injury Disaster Loan assistance (EIDL) and (ii) the SBA Paycheck Protection Program. 

Qualifying small businesses are defined by the SBA as:

500 or fewer employees, employed on a full-time, part-time

Business meets the SBA’s industry based “size standard” requirements based on the NAICS code

What Programs Are Available, and How Much Can Your Business Apply For?

SBA Economic Injury Disaster Loan

Provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. $10 billion has been provided by the government to make EIDL loans.

Business that self-certify as eligible will be advanced an amount up to $10,000 by the SBA, provided within 3 days after receipt of the application.   If an application is subsequently denied an EIDL loan, the SBA advance DOES NOT NEED TO BE REPAID.

 3.75% Interest Rate at up to 30 years

No personal guarantee for loans under $200,000

Loans issued directly by the SBA. To apply, click here. For assistance applying, please call (888) 601-7345 or contact us to schedule an appointment.

SBA Paycheck Protection Program

Provides small businesses with loans to help businesses retain employees. If employees are retained, the entirety of the loan will be forgiven and DOES NOT NEED TO BE REPAID. If some employees have already been laid off, the loan can still be forgiven for the full amount of payroll costs if those employees are rehired by June 30, 2020. $367 billion has been provided by the government to back these loans.

Maximum loan amount of 250% of average monthly payroll costs, up to a total of $10 million

Up to 10 year repayment terms at 4% or less on any amount not forgiven

Loans made by SBA banks and other lenders. To apply, click here.  

SBA Expansion of Express Loans

Increases maximum SBA 7(a) Express Loan amount from $350,000 to $1,000,000. 

One year interest deferral

Up to 7 year repayment terms at 8.75% or less

Loans made by SBA banks and other lenders. To apply, click here.  

What If Your Business Doesn’t Qualify, Needs More Money or Needs Money Faster

It is important to understand that you can apply to multiple government programs at the same time. A REIL Capital specialist can help you decide which programs you qualify for. If your business does not qualify for government assistance, needs additional capital or needs capital before your SBA Loan has been processed, here are a few options for you to consider: 

Business Line of Credit

business line of credit is a time-tested way for a small business to have quick access to cash to meet an unanticipated need. The upside of a line of credit is you pay for what you borrow, while still knowing that the full line is available if you need it — a good option for business owners who still have healthy businesses, but want to be prepared nonetheless. To apply, click here

Business Term Loan

The short applications and quick decision-making make it easier than ever for a small business to apply for an online term loan. An application can often be completed in a matter of minutes with an answer in 24 hours or less. What’s more, funds can be electronically deposited in your account within days. While many of these lenders have ceased lending in the past few days, some are already re-opening for applications. To apply, click here

Asset Based Lending 

If your business or you as the business owner, own property or other assets, an Asset based lending program may be your best option. This program is designed to help your business succeed by borrowing a lump sum of capital against an existing asset. To apply, click here

Merchant Cash Advance

Merchant cash advances are a fast and easy way for businesses to access funds. This type of funding can be completed in 24-48 hours with an average term length of 8 to 12 months and daily or weekly repayment options. This product is designed to provide businesses with a lump sum infusion of cash to generate increased revenue over the term length. To apply, click here

Tax Credits

The Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), the Families First Coronavirus Response Act (the “FFCRA”) and multiple state laws are providing significant additional tax credits to small business owners. Schedule a consult with one of REIL’s capital specialists to learn more about what your business qualifies for. 

REIL Capital is providing free consultations to help business owners apply for government assistance. Please click here to fill out and application and schedule a free appointment with a capital specialist.