Coronavirus Aid, Relief and Economic Security - CARES Act:

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The legislation passed by Congress contains several provisions to provide emergency assistance for Small Businesses affected by the pandemic.  This is our current understanding of the provisions in the bill for Small Business owners:

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• Paycheck Protection Loan Program expands loan eligibility under the SBA 7(a) program with the intention to assist businesses with covering costs related to payroll (including healthcare and certain related expenses), mortgage interest, rent, leases, utilities and interest on existing debt.

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• Borrowers will need to certify that they’ve been impacted.  There will be no personal guarantees or collateral associated with the loan. Detailed application requirements are still to be determined.

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• Loan amount maximum is 2.5 times average monthly payroll for the one year period prior to the date of the loan application

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• There will also be a payment deferral and SBA loan forgiveness program. 

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• Loan balances will have a maturity of not more than 10 years.

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• Sets a maximum interest rate of 4%