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COVID19 - SBA lending options

Posted by Megan Durst, CPA Posted on Apr 15 2020

Here is information on the SBA loans that are available to help small businesses during this time.  There are two loans options available to businesses (that you must ultimately choose between). 

PAYCHECK PROTECTION LOAN (“PPP”) – This loan is 100% guaranteed to be given based off 2.5 times average payroll from Feb/March 2019 to June 2019 (up to $10 million in loans).   

This is forgiven (no payback required) when used to cover payroll costs, interest of mortgages, rent and utility payments. 

There could be a reduction in the forgiveness based on reduced employees/salaries.  There is also some risk of it not being forgiven because the forgiveness funds could run out.

This loan can be obtained from SBA lenders (banks). 

SBA DISASTER ASSISTANCE LOANS - Since early March, this offering has been extended to small businesses across the nation that have had significant losses due to the coronavirus pandemic.

These loans have a 3.75% interest rate for small businesses and a 2.75% rate for nonprofits, and are usually capped at $2 million.

This loan is applied for on the SBA website and decisions come back usually in around 21 days.  The application is at

The tax return and a  personal financial statement needs done to apply for this loan.

We’ve been told by some banks that they suggest applying for the Disaster Assistance loan and then applying for the PPP loan when it’s available (in the end you’ll have to choose one).  Then you can choose which loan program to go with after all the information is known.