Financial Resources and Loan Options
7(a) Loan Payment Relief
SBA will pay the principal, interest, and any associated fees owed on 7(a) loans as follows:
- Existing borrower not on deferment: six months beginning with the next payment due on the loan;
- Existing borrower on deferment: six months of payments beginning with the next payment due on the loan after deferment period; and
- New borrower: six months of payments beginning with the first payment due on the loan, but only for new loans made within the first six months starting from the date of enactment. (3/27/2020).
Economic Injury Disaster Loan (EIDL)
Eligibility: Businesses with 500 employees or fewer
- Up to $2 million can be provided to help meet financial obligations and operating expenses that could have been met if the disaster did not occur.
- Loans can be made based solely on credit scores.
- The interest rate on EIDLs will be 3.75% interest rate for small businesses.
- The first twelve payments will be deferred and not become due until one year after the original disbursement. Interest does accrue during this time.
- The term of these loans will be up to 30 years.
Application: https://covid19relief.sba.gov/#/
Economic Injury Disaster Loan (EIDL) Advance
Eligibility: Advances are available to small businesses, sole proprietors, independent contractors, tribal businesses, as well as cooperatives and employee-owned businesses in operation on January 31, 2020
- For those that apply for the Economic Injury Disaster Loan (EIDL), an advance of up to $10,000 will be provided to small businesses within several days of applying for the loan.
- The advance does not need to be repaid, even if the grantee is subsequently denied an EIDL.
- Funds can be used to provide paid sick leave to employees, maintain payroll, meet increased production costs due to supply chain disruptions, or pay business obligations, including debts, rent, and mortgage payments.
Small Business Paycheck Protection Program
Eligibility: Small businesses as defined by SBA size standards, generally up to 500 employees, but up to 1,500 employees depending on the sector as certain sectors are based on revenue. Sole proprietors, the self-employed, and independent contractors are also eligible.
- A new $349 billion lending program under the existing SBA 7(a) program. The SBA guarantee of PPP loans will be 100% through the end of 2020. PPP loan payments will be deferred for a minimum of six and up to 12 months. Loans will be administered through local and regional banks; any federally regulated bank may become an SBA lender for this purpose. The Department of the Treasury will issue regulations for these loans quickly.
- The interest rate will not exceed 4%. Rate is currently fixed at 0.5%.
- Regulatory Streamlining:
- SBA’s standard “no credit elsewhere” test is waived.
- No personal guarantee or collateral required.
- No additional fees will be applied to these loans.
- Size of loans: Up to $10 million. Loan amount is based on recent payroll costs, compensation paid to individuals, including the self-employed. Compensation in excess of $100,000 a year to any individual is excluded.
- Requirements: The business must certify the loan will be used to retain workers, maintain payroll, make mortgage or lease payments, and pay utilities.
- Loans may be forgiven, up to an amount equaling eligible payroll, mortgage interest, rent and utility cost, incurred during the 8 week period starting from loan origination. Compensation in excess of $100,000 a year to any individual will not qualify for forgiveness.
- Loan forgiveness is reduced by layoffs or pay reductions in excess of 25%.
- Loan forgiveness is not treated as taxable income.
Apply for Small Business Paycheck Protection Program with VCC
Virginia Community Capital (VCC) will be ready to process more Paycheck Protection Program (PPP) applications as soon as the SBA confirms it has received another round of funding from Congress. VCC will be processing applications on a first come first serve basis.
- Questions you will need to answer on the application:
- Have you laid anyone off? If so, do you intend to bring them back on payroll?
- How will you spend the money, breakdown via rent, payroll, and/or utilities?
- Have you applied to another lender for a PPP loan or to the SBA for an EIDL?
Application Form: https://www.sba.gov/sites/default/files/2020-04/PPP%20Borrower%20Application%20Form.pdfhttps://www.sba.gov/sites/default/files/2020-04/PPP%20Borrower%20Application%20Form.pdf
SBA Express Bridge Loans
Enables small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly.
- These loans can provide economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loan or used to bridge the gap while applying for a direct SBA Economic Injury Disaster Loan. If a small business has an urgent need for cash while waiting for a decision and disbursement on an Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.
- Terms:
- Up to $25,000
- Fast turnaround
- Will be repaid in full or in part by proceeds from the EIDL Loan
Virginia Career Works – West Piedmont Region: Rapid Response COVID-19 Business Support Initiative
The West Piedmont Workforce Development Board has been awarded a Rapid Response Grant for $29,585 from the Commonwealth of Virginia to assist small businesses with certain costs related to the COVID-19 crisis that mitigates or minimizes potential job losses.
- Eligibility:
- Be a public or private business with 250 employees or less
- Be located in the West Piedmont Region (cities of Danville and Martinsville; counties of Henry, Pittsylvania, and Patrick)
- Fall within the Critical Infrastructure Workers Guidelines produced by the U.S. Department of Homeland Security or within the target industries identified by the region that includes Manufacturing, Information Technology, Healthcare and Life Sciences, Construction, Transportation and Logistics, Financial Services, and/or Education Services
Application: https://www.vcwwestpiedmont.com/content/vcwwestpiedmont/uploads/rapid-response-covid-19-employer-application-agreement.pdf
VA 30 Day Fund for Small Business
The non-profit Virginia 30 Day Fund provides forgivable loans for Virginia-based small businesses. The forgivable loan is intended to provide immediate financial assistance (within maximum three days) to meet payroll, preserve healthcare coverage for employees and save jobs while they await recently approved federal funding.
The Virginia 30 Day Fund is designed to be quick, easy, and free of red tape, as small business owners work to keep employees on board in the near term. All we ask in return: if you can, pay it forward.
application: https://va30dayfund.com/apply/
Martinsville Bulletin Local Marketing Grant Program
This program offers matching marketing funds to local businesses whose livelihood has been impacted by the outbreak of the COVID-19 virus.
- All advertising products the Martinsville Bulletin offers are eligible for the matching grant, so they can help you address your distinct business objectives.
- Grants will be issued up to $500,000 in total, ranging from $250 – $15,000 per month per client.
- Grants will be awarded for the months of April, May and June.
for more information: https://www.martinsvillebulletin.com/opinion/columnists/martinsville-bulletin-announces-grant-program-to-provide-marketing-assistance-to-local-businesses-impacted-by-covid/article_e702a824-83e8-11ea-bd82-4bd7ebb47884.html?fbclid=IwAR1mY6OIGlmibN24jbCYwLarlJBlmVRl0npG1ciMrRVNkASl-5kitktrrPw#utm_campaign=blox&utm_source=facebook&utm_medium=social
application: https://www.martinsvillebulletin.com/pages/local-marketing-grant.html
PBA COVID-19 Relief Fund for Beauty Professionals
The Professional Beauty Association, PBA, has created the PBA COVID-19 Relief Fund to help those in need.
This fund will help more than just barbers and hair stylists. Cosmetologists, instructors, massage therapists, nail technicians and other licensed professionals in the beauty industry are able to apply.
- The funding is intended to be emergency aid for short-term immediate needs such as food and bills, according to the PBA
- The grant comes in the form of a $500 Visa gift card that is a tax-free grant, not a loan, so nothing needs to be paid back
- The PBA says that applications are selected using a lottery process and that all applications remain in the lottery until they are selected
application: https://www.probeauty.org/covid-relief-fund-application
Helpful Links
CDC: Cleaning and Disinfecting Your Facility
https://www.cdc.gov/coronavirus/2019-ncov/community/disinfecting-building-facility.html
U.S. Small Business Administration Coronavirus Relief Options
https://www.sba.gov/funding-programs/loans/coronavirus-relief-options
Virginia SBDC COVID-19 Resources for Small Businesses
The Best National Resources for Small Businesses Weathering Coronavirus
https://blog.helloalice.com/national-coronavirus-covid-small-business-resources/
Hello Alice: Reopen with Resiliency Series for Small Business Owners (May 25th – June 5th)
https://www.covid19businesscenter.com/reopen-with-resiliency-sprint/
Silver Lining Small Business COVID Response Workbook
https://online.fliphtml5.com/mhxlt/zkxr/#p=1
VA Secretary of Commerce and Trade Financial Resources for Small Business
Applying for an EIDL: Application Update and Info
SBDC: Business Solutions in COVID-19 Panel Discussion
Need help applying for financial relief?
Get in touch with local business analysts who can help fill out loan applications and answer all of your business questions:
Longwood SBDC – Martinsville (Western):
(276) 656-5475
Michael Scales: scalesmc@longwood.edu
SBDC Client Registration: https://clients.virginiasbdc.org/reg.aspx?mode=counsel¢er=46091&subloc=0
Martinsville Henry County Chamber of Commerce:
(276) 632-6401
Lisa Watkins: lisa@mhcchamber.com
Upcoming Webinars
SBA Economic Resources for COVID-19 for Agriculture Businesses
June 4th, 2020 11:00 a.m. – 12:00 p.m.
Determine PPP Loan Forgiveness Eligibility with VCC:
Hello Alice – Apply for a Business for All Grant or COVID-19 Emergency Grant
Business for All is a national movement to lift up 100,000 small business owners to receive funding and mentorship. By completing the application, you’re eligible to receive up to $50,000 in grant funding.
In partnership with Verizon, as part of the Business for All movement, every applicant will receive access to opportunities, guides and networks to help their business grow.
appplication: https://businessforall.helloalice.com/grant
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