Unless you’ve been under a rock, you’ve heard about Thursday’s SBA announcement that they stopped taking ^lender applications^ for the Paycheck Protection Plan [PPP] loan, and that their Economic Injury Disaster Loan funds are exhausted.
Be sure to understand that these are 2 different things. 1) SBA funds for lending at 3.75% to businesses in a disaster zone, and 2) PPP funds.
Also, keep in mind that the Paycheck Protection Plan funds were allocated to banks – EACH BANK GETTING A CERTAIN ALLOCATION OF FUNDS -- and that the banks still have that money to fund as many loan applications as possible.
Therefore, you should continue to respond and process that PPP loan application until funded. Even if your bank does run out of PPP funds, which it might, keep going because it is likely there are more funds on the way.
Why? Because sole proprietors and partnerships were just a few days ago given green light to apply. What could be more unfair if all them were left out in the cold? Plus everyone else whom was delayed by their own bank, or who for whatever reason could not apply.
THEREFORE, if you have not yet applied, and your bank will take your application, get that going. If your bank won’t take your application, find out why. If they are not an SBA approved lender, they will be UNABLE to process PPP loans – see above what the SBA said about not taking lender applications ^.
As far as the SBA’s EIDL funds for dishing out loans to damaged businesses – YOU BET that will continue.
Here’s what the SBA is saying: “Applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis.”
Politically, our Congress knows they need to take care of this, and even the SBA indicates it will happen.
Therefore, if you have applied for the EIDL grant funds and low interest rate loan, rest assured your turn will come.
If you have not applied for the EIDL yet, you should do so as soon as the application process re-opens.