Such strange times we all find ourselves in. Nearly all U.S. businesses are experiencing declining or zero revenue… and when you add in payroll, debt payments, lease/rent payment, and utilities, we are quickly finding ourselves underwater. Seeing our way out of this challenging time isn’t clear, but thankfully we will be getting our life preserver very soon.
Now that the CARES Act has been signed into law, the finer details are being hammered out, as to how the funds will get into business owners hands. We are monitoring the Small Business Administration’s website for the new forms and rules. As much as we are super anxious to assist our business owner friends right now, we do want to make sure this is done correctly the first time. Once the forms and official guidelines are published, we will get moving on this with you.
Just about every business owner will qualify.. as all of the traditional credit and financial barriers have been removed. The amount of the loan will depend on how much your payroll normally is for an 8 week period. There are formulas used to calculate this for seasonal businesses too. Essentially, this will be 2.5x the average total monthly payroll cost incurred in the one-year before the loan is made.
Most of this loan will convert to a grant. However, any portion of the original amount not utilized for the intended uses will remain as a loan, payable monthly at 4% interest, over a 10 year period. Loan payments will pretty much be deferred until January 2021.
Stay tuned as we get these details ironed out for you!
your Stellar Business Funding Team