Small businesses in all 50 states can now apply for SBA coronavirus relief loans. The loans are low-interest and can go up to $2 million.
Update for March 31, 2020: In addition to the SBA’s Emergency Disaster Loan program, the SBA is administering a second loan program called the Paycheck Protection Program, which will provide $349 billion to small businesses. You can read more about the Paycheck Protection Program on Workest.
With the declared eligibility of Missouri, the Small Business Administration has opened the application process for low-interest loans for small businesses impacted by the coronavirus outbreak in all 50 states.
The SBA relief loans, which are intended to provide financial assistance to slowed or stopped small businesses, were announced by the administration of President Donald J. Trump. In a national address, he directed $50 billion in funding for the program.
The program offers up to $2 million per loan for small businesses under distress from the outbreak of COVID-19. Interest rates are 3.75% for small businesses and 2.75% for nonprofits. Repayment terms can be up to 30 years.
There was heavy interest in the loans from businesses facing sudden drops or altogether stops to their revenue as lockdowns were put in place, consumers cut back spending, and states or cities put in place strict restrictions to combat the spread of the virus. However, many businesses were confused over how to apply for the loans.
Part of the confusion was the prior process for gaining eligibility to disaster relief loans required a state’s governor to certify and ask the SBA to declare specific counties within the state eligible.
Missouri was approved near the last of a complete list of approved states for the coronavirus relief loans. This means small businesses in every state can apply for the loans if they’ve experienced a negative impact.
It can take between two to three weeks for the SBA to make a decision once a loan application is submitted by a business. If the loan is approved, disbursement of funds can be made within five days of receiving the loan closing documents, according to an SBA spokesman.
The SBA said that small businesses can apply for the loans directly on their website at www.sba.gov/disaster. Business owners can call the disaster customer service center at 800-659-2955, or email [email protected]. The deaf and hearing impaired may call 800-877-8339.
Editor’s Note: Neither Workest or Zenefits is affiliated with the Small Business Administration (SBA) or a lending organization. This article is intended for informational purposes only.