COVID-19: SBA Loan Summary
7a Loan Program
- These loans are working capital loans which do not require any equity injection (100% loans). Can be utilized for salaries, sick leave, insurance, mortgage and rent payments.
- Maximum amount of $10 million per borrower.
- Little limitation on type of Borrower – Can be corporations, partnerships, sole proprietors, LLCs, independent contractors, and nonprofits.
- 500 employee maximum.
- Multiple physical locations for a business now treated separately.
- Typical SBA Affiliation Rules are waived.
- Eligibility not tied to ability to repay, but instead solely to whether you had employees or independent contractors.
- Collateral and Personal Guarantees waived.
- Maximum interest rate of 4%.
- No Pre-Payment Penalties.
- Deferment of Loan Payments for a minimum of 6 months / maximum of 12 months.
- Amount spent by Borrower for 2 months after loan origination spent on payroll, interest on mortgages, payment of rent, and payment on utilities will be forgiven.
- Forgiveness of indebtedness not to be considered taxable income to Borrower
Economic Injury Disaster Loan Grants
- These loans are for businesses located within an area where a disaster has been declared.
- Don’t have to be in business for 1 year … that requirement is waived.
- Personal Guarantees on Loans under $200k are waived.
- Any applicant can get an advance of $10k within 3 days of application. If denied for loan, no requirement to repay.
- Can be used for essentially any purpose, including, but not limited to, sick leave, payroll, increased material costs, rent/mortgage, and other obligations.
Existing SBA Borrowers
- Can receive a 6 month deferment of payments.
- Maximum of $100,000 per borrower.
- Must have less than 100 employees.
Erie County Redevelopment Authority
- Maximum of $50,000 per borrower, proceeds available within 7 days.
- 0% interest.
- Deferral of payments for 90 days.
Bridgeway Capital / ECGRA Loans for Erie County
- Nonprofits located in Erie County
- Small businesses under 25 employees located in Erie county that are any of the following:
- Minority-, woman-, immigrant- or veteran-owned businesses, or
- Businesses or nonprofits that serve economically distressed neighborhoods in Erie County
- Flexible repayment terms with no payment required for 3 months
- Low-interest rates at 4% for small businesses
- Low-interest rates at 3% for nonprofits
- Loans from $5,000 up to $50,000
Please contact your Knox Law attorney to learn more or to discuss how your business could benefit from one of these programs. If you are not currently a client, please call 814-459-2800 to leave a message and someone will get back to you within 1-2 business days.
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