When businesses began shutting down in March, their big question for government officials and lenders was: What can you do to help us now? Four months into the pandemic — some businesses still find themselves sifting through disaster relief financing options, many of them changing weekly. Here are a few key programs on Seedcopa’s radar:
COVID-19 Relief Pennsylvania Statewide Small Business Assistance Program
That’s a mouthful! This program provides $225 million in grants from $5,000 to $50,000 to eligible businesses through CARES Act funding. This is not a first-come, first-served program, and there will be multiple rounds of application windows. Seedcopa does not administer this program, but there are multiple CDFIs that do and businesses must apply through them. Here’s what you need to know:
Program summary, who’s eligible & what documents to gather
List of CDFIs that administer the program, by county
Why we like it:
- –Not first come, first served
- –Grants that cover practical needs
- –At least 50% of the grants to small businesses will be awarded to historically disadvantaged businesses
Paycheck Protection Program – Extension!
President Trump has signed the PPP Extension Act, which extends the filing deadline for Paycheck Protection Program loans to August 8, 2020. If businesses follow the program’s guidelines, their debts are forgiven. Money used for other purposes turns into low interest loans with five-year terms.
Paycheck Protection Program resources
Why we like it:
- –Forgivable loans for qualifying businesses
- –Up to 10 weeks’ worth of payroll to use mostly on paying workers and some other fixed costs
Economic Injury Disaster Loan
EIDL has long existed, but there’s new legislation to reduce the interest rate to 1%, raise the cap on maximum loan amounts, and add more funds to the program. The legislation is still under consideration, but meantime the EIDL interest rate has been at 3.75% and is worth considering for certain businesses.
Why we like it:
- –EIDL loans can be more flexible than PPP and cover a wide range of costs
- –Small businesses that were unable to apply for PPP may be a fit for EIDL
- –Online application and recent quick turnaround time on decisions/approvals
If your business is looking to GROW during these trying times, here is great news on PIDA loans:
As of July 1st, PIDA loans have a lowered interest rate of 1.75% for a 10-year fixed term and 15-year fixed term. This is after months and months at 3%. Seedcopa has long administered PIDA Loans, and we are happy to assist. But you know the saying, “Act fast!” These rates are in effect for loan applications received through September 30, 2020.
There are many ways that borrowers have used PIDA, but for now the options have slightly narrowed to real estate for industrial, manufacturing, multi-tenant and industrial park properties. If you wonder if there is a way you would fall into one of these categories, reach out to us.
Why we like it:
- –Interest rate is incredibly low and can be fixed for up to 15 years
- –PIDA funding generally ranges between $50,000 and $2,000,000, with total projects potentially exceeding $4,000,000
- –Many businesses are eligible as long as they have less than 100 employees
