A couple of months ago I wrote about Federal Funds that were available to small business owners. One program was the Payroll Protection Plan (PPP) and the other was the Economic Injury Disaster Loan. I wanted to reiterate that these loans are available to any small business self-employed person even if you are the sole worker in your business. The Government did make a change to the Economic Injury loan as they now will give $1000 per employee which is an adjustment from the $10,000 per business they originally said. The PPP loans however are using the same formulas as the original guidelines although there are currently some potential changes that could happen in the weeks to come. A second stimulus was produced for the PPP and there are still 100 billion of those funds that are available. Please contact me if you would like more information on these programs. Note that although the PPP is technically a ‘loan’ there are specific instructions on how to make it a Federal grant. It is estimated that virtually 100% of these loans will become a grant.

Over the past two months, almost all lenders that offer working capital loans have ceased accepting applications. Although most lenders are still loaning on business essential equipment there have been restrictions put into place and there are some that stopped accepting applications altogether. Over the past week, I have seen the industry beginning to loosen up on some restrictions. It most likely will be another 30-60 days until things are back to ‘normal’ but lenders are definitely beginning to breathe a bit easier and that will be reflected in their guidelines and underwriting soon.

NOTE: I am sure that many of you are aware of the revised IRS schedule for 2020. I want to mention because I have spoken to some that were not updated that 2019 tax returns AND payments for taxes due have been extended to July 15, 2020. Lenders are aware of this but some are still requiring to see 2019 returns. If you have the means then it is a good idea to still file and pay before you apply for any type of commercial loan.

For almost 250 years Americans how proven their resiliency to the world. It staggers our minds when we think of how so many things have changed in the last 90 days. The one thing that we can be certain, however, is to know that the work ethic and desire to succeed in so many of us will rebound us back to prosperity in the near future; I am taking that to the bank!

Hoping for a successful month for everyone,

Tim