SBA's Programs Associated with the CARES Act in response to COVID-19

The Economic Injury Disaster Loan Application (EIDLA) Program

The website for the application submission is:



Small businesses and private non-profits located in geographic areas (primarily states and tribal territories) declared disaster areas.



Addressing costs that cannot be paid due to COVID-19, like fixed debts and payroll.



SBA offers long-term repayment, capped at 30 years; loan terms vary based on determinations about each individual borrower’s case. 

The Payroll Protection Program

Program Overview:

The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.  SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.  The Paycheck Protection Program will be available through June 30, 2020.


Who Can Apply:

This program is for any small business in operation prior to February 15, 2020 with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by coronavirus/COVID-19.  Businesses in certain industries may have more than 500 employees if they meet the SBA’s size standards for those industries.  Small businesses in the hospitality and food industry with more than one location could also be eligible at the store and location level if the store employs less than 500 workers. This means each store location could be eligible.  Borrowers must certify that economic conditions make the loan necessary to support operations and not have an application for another 7(a) loan pending. Businesses must be in good standing with the SBA.


How to Apply:

You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union,  and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.


Approved Uses:

The loan can be used for the following purposes: employee salaries or wages, group health premiums, employee benefits (vacation, paid leave, family leave, medical leave), retirement benefits, payment of state and local taxes assessed on employee compensation, mortgage payments, rent, utilities payments, interest on debt obligations incurred before February 15, 2020.


What are Payroll Costs:

Compensation to employees that is a salary, wage, commission or similar compensation; cash tips; vacation, parental, family, medical, or sick leave; allowance for dismissal or separation; group health care benefits; retirement benefits; and state or local taxes on the compensation of employees; and


Compensation to sole proprietors, or independent contractors that is an amount not more than $100,000 in 1 year (prorated for February 15 - June 30, 2020).


However, payroll does not include compensation of an employee in excess of $100,000/year (prorated for February 15 - June 30, 2020), federal income taxes, compensation for employees who principally reside outside the U.S., and qualified sick and family leave wages for which a borrower receives a credit under §§ 7001 and 7003 of the Families First Coronavirus Response Act.


Loan Terms:

Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.  This loan has a maturity of 2 years and an interest rate of .5%.  If you wish to begin preparing your application, a sample form with the information that will be requested from you has been attached to this email.


Loan Forgiveness:

Loan recipients can be eligible for loan forgiveness equal to the total amount paid for payroll costs, mortgage, lease and utility costs, but the forgiveness amount can be reduced if the number of full-time equivalent employees is reduced. The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll).


Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels.  Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.


What do I need to do to have all or part of my loan forgiven?


You must apply to your lender. The application must include but is not limited to the following:


  • documentation (including payroll filings) verifying the number of FTEs you employ and employed during the relevant periods and the compensation that you paid them, and documentation (including cancelled checks, payment receipts, transcript of accounts, etc.) verifying payments of mortgage obligations, rent, and utilities;

  • a certification representing that the documentation is true and correct and that the amount of forgiveness requested was used for retaining employees and paying mortgage interest, rent, and utilities during the covered period;

  • any additional information that the SBA Administrator requires.


Will there be further guidance regarding loan forgiveness?


Yes. The SBA Administrator is required to issue further guidance regarding loan forgiveness within 30 days of the enactment of the CARES Act (by April 27, 2020)



Lenders may begin processing loan applications as soon as April 3, 2020.  The regulations that the SBA will promulgate by April 11th can impact the application of PPP.   The loan program will be guaranteed 100 percent by the SBA. The program also temporarily increases the maximum amount for an SBA Express loan from $350,000 to $1 million through December 31, 2020

SBA Debt Relief

The SBA Debt Relief program will provide a reprieve to small businesses as they overcome the challenges created by this health crisis.


Under this program:

  • The SBA will also pay the principal and interest of new 7(a) loans issued prior to September 27, 2020.

  • The SBA will pay the principal and interest of current 7(a) loans for a period of six months.


SBA Express Bridge Loans

The Express Bridge Loan Pilot Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with less paperwork. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan.  If a small business has an urgent need for cash while waiting for decision and disbursement on Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.



  • Up to $25,000

  • Fast turnaround

  • Will be repaid in full or in part by proceeds from the EIDL loan

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