As we all work together to stop the spread of the new coronavirus, COVID-19, our local businesses are feeling the effects. A new study released by America’s Small Business Development Centers (SBDC) and Thryv Inc. found that 82% of small businesses are “extremely concerned” about the current situation.

   

The good news is we are all in this together. Small businesses remain the lifeblood of our economy and many of us are doing our part to help these businesses during this time, from ordering take-out to buying products online. Valley Bank, a preferred lender with the U.S. Small Business Administration (SBA), is also working hard to ensure small businesses get access to the relief programs available to them.

    

In fact, there are a number of financial assistance programs that have emerged specifically to help small businesses rebound and to get our economy roaring again. Here’s a look at some of the new programs that have been set up to help small businesses like yours.

    
   

1. SBA Debt Relief / Loan Deferment

The SBA is offering a debt relief program to provide a reprieve to small businesses who are struggling in this difficult time. Under this program, the SBA will pay the principal and interest of current SBA 7(a) for 6 months, as well as the principal and interest on new SBA 7(a) loans issued prior to Sept. 27, 2020.

    

For borrowers with existing Valley SBA 7(a) Loans who are experiencing temporary cash flow issues, we may be able to offer you a temporary deferment. Interested customers should complete the Borrower Request for Deferment form and contact their primary commercial lending officer for submission.  

2. SBA Express Bridge Loans

The SBA has also introduced an Express Bridge Loan Pilot Program which allows small businesses who currently have a relationship with an SBA Express Lender to quickly borrow up to $25,000 to help them through a temporary loss of revenue or “bridge the gap” until they can apply for and receive an SBA Economic Injury Disaster Loan (more on this below). This program is intended for small businesses who have an urgent need for cash in the short term.

    

For more small business guidance and loan resources during the Coronavirus, check out the SBA’s Coronavirus resource page.

3. Coronavirus Aid, Relief, and Economic Security Act (CARES Act)

The CARES Act – the largest nationwide financial assistance package in history – was signed into law on March 27, 2020 and allocates $2 trillion for businesses, individuals, federal agencies, and state and local governments impacted by the Coronavirus. This act was designed to distribute capital quickly and broadly to try to mitigate the economic fallout from COVID-19, and it contains a number of provisions that specifically affect small businesses like yours, such as:

   

• Paycheck Protection – Designed to incentivize small businesses not to lay off workers (or to rehire laid off workers) during the Coronavirus, thePaycheck Protection Program has set aside $350 billion in government backed loans to allow small businesses to maintain their payroll through June. Qualified small businesses can take out a loan for up to $10 million, with an interest rate no higher than 4%.

• Business Tax Changes – Eligible businesses may be able to get an employee retention tax credit, defer their payroll tax payments over the next two years, and increase their business interest expense deductions on their tax returns. There are a number of other tax changes that are included in the CARES Act – talk to your tax advisor to ensure you are capitalizing on them.

• Unemployment assistance – If your business is closed because of coronavirus and your employees cannot work from home, or your employees are unable to work due to illness or the need to take care of someone who is ill with the virus, they can collect unemployment. The CARES Act also will be providing stimulus checks directly to individuals throughout the US who make less than $75,000 a year.

For more information on how the CARES Act applies to small businesses, see the US Chamber of Commerce’s helpful guide.

     

4. The Florida Small Business Emergency Loan Program

The Florida Small Business Emergency Bridge Loan Program is currently available to small business owners located throughout Florida that experienced economic damage as a result of COVID-19. These short-term, interest-free working capital loans – for up to $50,000 – are intended as temporary assistance between the time a major catastrophe hits and when a business has secured longer-term recovery resources.

     

For assistance, businesses should contact their local Florida Small Business Development Center.  They can find their local office at www.FloridaSBDC.org/locations. Interested businesses need to apply to the program as these are DIRECT loans, not bank loans. 

To learn more about state programs for Alabama, Florida, New Jersey and New York, see our list of relief programs by state.

   
     

5. Economic Injury Disaster Loans (EIDL)

Businesses that have been adversely impacted by COVID-19 can apply for disaster loans. These are low-interest, long-term disaster loans up to $2 million that can provide vital economic support to small businesses.

    

Interested businesses need to apply to the SBA as these are DIRECT loans, not bank loans. For additional information, borrowers should contact the SBA disaster assistance customer service center at 1-800-659-2955 or apply online.

 

Valley is dedicated to helping small businesses through this challenging time. We’re a Preferred SBA Lender with demonstrated proficiency in approving, processing and servicing SBA guaranteed loans, and are ranked as one of the top SBA lenders in the Tampa Bay region. You can trust us to help you navigate this uncharted territory and get the funds you need.

    
    

Visit our Business Lending Resources page for more information, see our Coronavirus page for updates, or contact us.