We’re in a different world than we were a month ago and our business and personal lives have been upended. As with any seismic event that changes us, our outlook, and our opportunities we look for ways to navigate through it. The first phase of change is always the worst – shock, denial, grief – are all common reactions. The second phase is the navigating, trying to adjust to the new reality, predicting the future, and creating strategies that might work. The last phase is the new normal. As the corona virus outbreak was an unexpected event, we didn’t have time to do any planning in phase one, and apparently neither did our government.
However, the US Small Business Administration has come up with some help for all small businesses, those with less than 500 employees, and all small businesses will qualify for at least one or more of the programs.
Let me give you a quick rundown on the programs to help sort through the clutter.
Paycheck Protection Program
This helps all small businesses keep or rehire employees, up to $10M per small business. It’s a loan but will be forgivable if you keep those employees on, and don’t lay them off before the end of the period. Even if you have to let some go, it’s pro-rated. If you’ve already laid off your employees, you can base it on what your payroll will be when you rehire them – which you will have to do, or the money will need to be repaid. Of the total amount you get, 75% will be for payroll and 25% can go towards, rent, interest and other various expenses to keep you in business. You must apply through your bank. This program was opened up on April 3rd. Be sure to check with your bank to see if they are participating. Most big banks like Chase and Wells Fargo are in the program. Click here for an additional list from the SBA for the Puget Sound area. It’s unlikely that you will be able to get a new bank to take you on right now as they will be too busy taking their existing clients.
Independent Contractors and Self-Employed individuals will also be able to apply for this – to cover your own salary starting April 10th.
EIDLA – Economic Injury Disaster Loan Advance
Directly from the SBA – this provides up to $10,000 per business, independent contractor or self-employed individual as an advance and is likely to be forgiven. It appears it’s more of a grant and you can apply now, everyone should apply for this asap.
SBA Debt Relief
This is 6 months of debt relief for new and current SBA backed loans. Check with your lender to see if you qualify. New loans will be hard to get but if you need one and qualify, please try. Click here for information.
Express Bridge Loan
This provides up to $25K in advance of and SBA Debt Relief loan. While you wait for the bank to approve your debt relief, they will advance you $25K. Supposedly faster than waiting for the previous approval.
Most of these programs are first-come, first-served so please get your applications in as soon as possible and don’t worry about whether you qualify or not right now. The first two programs are direct relief for small businesses, and it appears will likely be forgiven or more like grants vs. loans.