Who Can Apply for SBA, PPP and EIDL LOAN ?

Congress approved another $284 billion in funding for these loans in the stimulus bill enacted December 27, 2020. Business owners may now apply for these loans. Read on for more information on how to qualify and apply

What Are The Differences?

The SBA, has launched the PPP and EIDL loans are now available.  So what does that mean for you being a business owner or sole proprietor?  With so many different types of loans, grants and help that have just recently been approved, finding the correct one can be a little confusing.  In fact, here is a little breakdown of how each of these options work.

SBA (Small Business Association) works along with lenders (financial institutions) to provide loans to small businesses.
The agency doesn’t lend money directly to small business owners. However, the guidelines for the loans are made by its partnering lenders, micro lenders and other development organizations.  The SBA has structured it this way to reduces risk for lenders and makes it easier for small businesses to get loans.

The Most Common SBA Loans

• PPP ( Paycheck Protection Program) First Draw and Second Draw
• EIDL (COVID-19 Economic Injury Disaster Loan)
• SVOG (Shuttered Venue Operators Grant)
• SBA Express Bridge Loans
• SBA Debt Relief

Updated January 21, 2021: The SBA has released guidance for new PPP loans available under the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (the Economic Aid Act).  This article includes the latest guidance and the new application forms. For the most current updates please refer to www.sba.gov 
 What is the PPP( Paycheck Protection Program)?
SBA, in consultation with the U.S. Treasury Department, reopened the Paycheck Protection Program (PPP) for First Draw Loans the week of January 11, 2021.

The Paycheck Protection Program (PPP) loan is a type of SBA loan to help small businesses impacted by COVID-19 to help with payroll expenses for their workers.   There are two options to apply for, First Draw and Second Draw PPP Loans.

 First Draw PPP Loans
First Draw PPP Loans can be used to help fund payroll costs even including benefits.
Per the SBA.GOV guidelines 

Who Can Apply For The First Draw PPP

• Sole proprietors, independent contractors, and self-employed persons
• Any small business concern that meets SBA’s size standards (either the industry size standard or the alternative size standard)
• Any business, 501(c)(3) non-profit organization, 501(c)(19) veterans organization, or tribal business concern (sec. 31(b)(2)(C) of the Small Business Act) with the greater of:
◦ 500 employees, or
◦ That meets the SBA industry size standard if more than 500
• Any business with a NAICS code that begins with 72 (Accommodations and Food Services) that has more than one physical location and employs less than 500 per location
The funds may also be used to pay for:
• Mortgage interest
• Rent
• Utilities
• Worker protection costs related to COVID-19
• Uninsured property damage costs caused by looting or vandalism during 2020.
• As well as certain supplier costs and expenses for operations.

SBA  may be willing to forgive loans if all employee retention criteria are met and the funds are used for eligible expenses.  For more information regarding loan forgiveness please refer to forgive loans
Note -You can apply for a First Draw PPP Loan until March 31, 2021.  SBA is currently accepting First Draw PPP loan applications from participating lenders.
Contact your nearest lender to see if they can assist you with applying for a PPP Loan.  Most financial institutions are able to help you with the process.  You can also find the PPP Application here FIRST DRAW PPP APPLICATION 

 Second Draw PPP Loans 

Who can apply for a PPP Loan?  Certain eligible borrowers that previously received the First Draw PPP loan are now able to apply for a Second Draw PPP Loan. It will in fact carry the same guidelines and loan terms as the First Draw.
Per the SBA.GOV guidelines 
 
Who Can Apply For The Second Draw PPP

• Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
• Has no more than 300 employees
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020
The funds may also be used to pay for:
• Mortgage interest
• Rent
• Utilities
• Worker protection costs related to COVID-19
• Uninsured property damage costs caused by looting or vandalism during 2020.
• As well as certain supplier costs and expenses for operations.
 *Most PPP don't pull credit. The lender might inquire for verification purposes .
Note -You can apply for Second Draw PPP Loan until March 31, 2021.  SBA is currently accepting First Draw PPP loan applications from participating lenders.
Contact your nearest lender to see if they can assist you with applying for a PPP Loan.  Most financial institutions are able to help you with the process. 
You can also find the PPP Application here SECOND DRAW PPP APPLICATION
SBA  may be willing to forgive loans if all employee retention criteria are met and the funds are used for eligible expenses.  For more information regarding loan forgiveness please refer to forgive loans

Achieve Your Dreams
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This release was published on openPR.