The Coronavirus Aid, Relief, and Economic Security (CARES) Act has allocated $350 billion to help small businesses and nonprofits keep workers employed during the global pandemic and economic downturn.
Known as the Paycheck Protection Program (the “Program”), the initiative provides 100% federally guaranteed loans to eligible organizations at 1% with no payments due for two years. Importantly, these loans may be partially forgiven to the extent borrowers maintain their payroll levels during the crisis or restore their payroll afterward. Here is a link to the Application Form from the SBA Website. Small businesses can first apply on Friday, April 3, 2020. Given the high volume of expected applicants and the limited funds available, you should apply as quickly as possible and expect funding delays. Thus, we encourage our clients to apply early. We recommend that you start by contacting your business banker. Our expectation is that lenders will process loans on a “first come first serve” basis and will prioritize existing customers over others. In the meantime, these guidelines are outlined to help our clients understand what to expect and how to prepare for the loan application process.