Village of Bellwood Chamber of Commerce issued the following announcement on July 20
We wanted to share updates on three of the federal relief programs contained in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27, 2020.
Main Street Lending Program Launches
At long last, the Federal Reserve’s Main Street Lending Program (MSLP) is up and running. Created by the CARES Act, the program is designed to help credit flow to small and medium-sized businesses (up to 15,000 employees) that were in sound financial condition before the onset of COVID-19, but are now in need of loans to help maintain their operations until they have recovered. The minimum loan amount is $250,000 with a five-year loan term., The interest rate is LIBOR plus 3 percent and principal and interest payments are deferred for two years and one year, respectively. Like the Paycheck Protection Program (PPP), the program is run through the banking system, but unlike the PPP no portion of these loans are “forgivable.” Businesses may apply for MSLP even if they have already received a PPP loan. See main page here, a good summary of the program here and a current list of participating lenders here.
PPP Application Deadline Extended to August 8
Under the PPP, businesses with 500 or fewer employees, as well as independent contractors (ICs) and the self-employed, can apply for a low-interest, forgivable loan of up to $10 million from any participating lender. As of today, more than $130 billion allocated to the program remains undisbursed. On July 4, President Trump signed into law S. 4116, legislation that had quickly passed Congress, that reauthorizes lending under the PPP through August 8, 2020 (but makes no other changes to the program). Anyone eligible who hasn’t applied already is strongly encouraged to do so, as the rules were made more borrower-friendly in June. The Treasury Department’s small business relief page, and find a participating lender here
SBA Exhausts EIDL Advance Funding
Under the CARES Act, Congress dramatically increased funding for the Small Business Administration’s (SBA) existing Economic Injury Disaster Loan (EIDL) program, and also created a $10,000 emergency advance payable to the loan applicant within three days of submitting the EIDL application. This amount does not need to be repaid, even if the application is ultimately denied, so the advance is considered a grant. Over the weekend, the SBA announced that it had exhausted the $20 billion Congress set aside for the emergency advance portion of the CARES Act, but that it will continue to accept applications for EIDL loans. EIDL loan terms include a 3.75 percent interest rate for small businesses, a 30-year maturity and an automatic deferment of one year before monthly payments begin. If you haven’t already applied and are interested in doing so, the EIDL application page is here.
This update pertains to existing federal COVID relief programs. While these programs have provided some relief to many businesses who have been able to access them, many of these programs are expiring soon and given the scale of the COVID pandemic it’s clear that more help is needed. Bellwood Chamber of Commerce will continue bringing resource information to secure more relief to you.
Original source can be found here.
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