CARES Act Resources
The Coronavirus Aid, Relief and Economic Security (CARES) Act was signed into law by the President on March 27, 2020. Many resources were expanded by the American Rescue Plan Act of 2021 (ARPA).
Below are resources to help better understand what is available to assist your small business at this time. Please note that the situation is fluid and changing regularly; check this page often for news and updates about resources.
Paycheck Protection Program
UPDATE: The instructions for applying for forgiveness of your Paycheck Protection Program (PPP) loan are now available. The Borrower must complete this application as directed in these instructions, and submit it to your Lender, or the Lender that is servicing your loan. Borrowers may also complete this application electronically through their Lender.
The Paycheck Protection Program (PPP) is one of the signature offerings of the CARES Act. The $349 billion program provides cash-flow assistance through 100 percent federally guaranteed loans to employers who maintain their payroll during this emergency.
The maximum loan size is $10 million.
The loan amounts will be forgiven as long as:
- The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8 week period after the loan is made; and
- Employee and compensation levels are maintained.
Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs.
Loan payments have a 1.00% fixed rate. Loan payments will be deferred for 6 months.
All businesses – including nonprofits, veterans organizations, Tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors – with 500 or fewer employees can apply. Businesses in certain industries can have more than 500 employees if they meet applicable SBA employee-based size standards for those industries.
How to Apply
Applicants can apply through any existing SBA lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating.
You will need to complete the application and submit it with the required documentation to an approved lender that is available to process your application by May 31, 2021.
Economic Injury Disaster Loan (EIDL) & Targeted EIDL Advance
The SBA is offering low-interest loans to qualifying small business owners and agricultural businesses with fewer than 500 employees. Read more about the EIDL on the SBA's website.
If you were approved for an EIDL loan for less than $500,000 before April 7, 2021, you are likely eligible for an increase. The SBA is now reaching out directly to borrowers via email.
Targeted EIDL Advance
The targeted EIDL Advance seeks to ensure the prosperity and sustainability of small businesses in low-income communities. Advance funds of up to $10,000 will be available to eligible applicants in low-income communities who:
- Previously applied for the EIDL Advance and...
- received an Advance for less than $10,000 OR
- received no Advance due to lack of available funding
SBA will reach out to you if you qualify.
EIDL and Paycheck Protection Program
EIDL applicants, whether you’ve already received an EIDL unrelated to COVID-19 or you received a COVID-19 related EIDL and/or Emergency Grant between January 31, 2020 and June 30, 2020, you may also apply for a PPP loan.
If you ultimately receive a PPP loan or refinance an EIDL into a PPP loan, any advance amount received under the Emergency Economic Injury Grant Program would be subtracted from the amount forgiven in the PPP. However, you cannot use your EIDL for the same purpose as your PPP loan.
How to Apply
Small Business Debt Relief Program
This program provides immediate relief to small businesses with non-disaster SBA loans, including 7(a), 504, and microloans. The SBA will cover all loan payments on these SBA loans, including principal, interest, and fees, for six months. This relief is available to borrowers who took out 7(a), 504, and microloans loans prior to September 27, 2020.
In addition, for current SBA Serviced Disaster (Home and Business) Loans: If your disaster loan was in “regular servicing” status on March 1, 2020, the SBA is providing automatic deferments through March 31, 2021.
What does an “automatic deferral” mean to borrowers?
- Interest will continue to accrue on the loan.
- 1201 monthly payment notices will continue to be mailed out which will reflect the loan is deferred and no payment is due.
- The deferment will NOT cancel any established Preauthorized Debit (PAD) or recurring payments on your loan. Borrowers that have established a PAD through Pay.Gov or an Online Bill Pay Service are responsible for canceling these recurring payments. Borrowers that had SBA establish a PAD through Pay.gov will have to contact their SBA servicing office to cancel the PAD.
- Borrowers preferring to continue making regular payments during the deferment period may continue remitting payments during the deferment period. SBA will apply those payments normally as if there was no deferment.
- After this automatic deferment period, borrowers will be required to resume making regular principal and interest payments. Borrowers that cancelled recurring payments will need to reestablish the recurring payment.
The US Department of Treasury has released a comprehensive list of resources about the new Paycheck Protection Program, including a Frequently Asked Questions page, and information on finding an eligible lender.
US Senate Committee on Small Business and Entrepreneurship
To help assist small business owners understand the provisions of the CARES Act, the US Senate Committee on Entrepreneurship has created a comprehensive guide with information on the programs and initiatives contained within the Act.
Information for Faith-Based Organizations
The SBA has created a document with frequently asked questions for faith-based organizations participating in the PPP and EIDL programs.