SBA Disaster Recovery Loans and the CARES Act

(Coronavirus Aid, Relief, and Economic Security Act)  [update as of 9/3/2020]

SBA’s PPP Loan Forgiveness

Now that the chaos of the SBA’s PPP loan funding has subsided, most businesses were waiting on the final interim rule regarding the ‘forgiveness’ portion of the program.  The final determination was streamlined as of 6/18/2020… or was it?

The SBA (Small Business Administration), along with consult by the Department of Treasury, continue to review this process.  As most loan recipients still have approximately 10 more months before the forgiveness application will be due, we recommend not actually submitting it yet.  This recommendation, of course, has a few degrees of variance which depends on your business structure and use of funds.

We DO recommend getting your application prepared and docs loaded and ready to go.  However, word out indicates that the forgiveness will possibly be more lenient for smaller entities, such as Sole Proprietors, and Independent Contractors.  Most loan providers will automatically send you this information as the guidelines change, so please adhere to whatever requirement your loan provider has for you.  Final guidelines require PPP loan recipients to apply for forgiveness through their loan provider, therefore if unsure, always contact your original loan provider.

Find more info and updates here on the SBA website, or download the SBA Forgiveness application to see what kind of info you will need.  Feel free to contact us for any alternative business funding or PPP application information.  Either way, we wish everyone safety and returning prosperity during these uncertain times.  Here is a link to the Loan Forgiveness EZ form.  You can find some answers to the SBA PPP Loan Forgiveness ‘frequently asked questions’ here.

SBA EIDL (Economic Injury Disaster Loan)

  • The SBA economic injury disaster loans (EIDL) are no longer providing the ‘advance’ portion of the loan.  However, this loan program is still active and available through the end of 2020.  (Something we are all looking forward to)
  •  How to Apply for EIDL
    • SBA has an online application on their website:  Click here to apply on the SBA site
    • Stellar Business Funding is available to assist in the EIDL application process and facilitate the varying steps in the process. Please contact us now for more details.

 ** The Paycheck Protection Program is implemented by the Small Business Administration with support from the Department of the Treasury.




SBA Loan Programs – The Small Business Administration seeks to solve small business cash flow problems by providing operating working capital small business loans to merchants of small and mid-sized businesses.

They also want to help start-ups, and promote commerce and enterprise in particular areas, occupations, industries. The SBA is a government agency and although we can help you get one of their loans, we are not affiliated or endorsed by them.

Initial Requirements

  • Business owners must be American citizens.
  • No previous or outstanding defaults on government-backed loans.
  • No tax liens or judgments filed any business, principal, or guarantor.
  • No delinquent taxes owed to the IRS.
  • No open litigation that could cause financial penalties.
  • You must have a detailed business plan.
  • Full documentation required with profit loss, and balance sheet.
  • 10% down payment or capital injection for purchases.

The main advantage of the SBA Loan Program is its low-interest rates. There are 2 SBA Loan Programs, the no-collateral Express Loan, and the collateralized 7(a) Loan.

SBA Express Loans

SBA Express Loans have terms of 2 – 10 years with variable interest rates of Prime + 4.75%. The application process takes 2 – 4 weeks and you will be required to meet several qualifications. No collateral is required.

SBA Express Loan Requirements

  • A 680 FICO credit score.
  • Be a current or past US military veteran or the spouse of one.
  • Located in an underutilized business zone.
  • Sell items that can be exported.
  • Sell items on your website that can be shipped to Canada, Mexico, or any other country.
  • Go to The Wall Street Journal for a link that shows the latest Prime Rate.

SBA 7(a) Loans

SBA 7(a) Loans have terms of up to 25 years with variable interest rates of Prime Rate + 2-3%. Because you will need to provide full personal and business documentation, and you’ll also need to fully collateralize with real estate and/or assets equal to your loan amount, the application process for this loan takes 2 – 6 months.

SBA 7(a) Loan requirements

  • You must be US citizens or registered aliens.
  • It must be a for-profit business.
  • The business mustn’t exceed SBA size standards.
  • Your business must not engage in lending, investing, gambling, or property speculation.
  • You must not be on probation or parole.

Although you don’t absolutely have to have real estate collateral, it is extremely difficult to get one of these loans without it.

And, there is no minimum FICO credit score requirement for 7(a) Loans, but know that you must have very good credit to qualify.

If you think you meet the requirements for either of these SBA Loans, Contact Us to apply …… we’d be happy to help you!