Stream Lined - SBA loan application , New SBA Paycheck Protection Loan, Restaurant Worker Aid

[CalGalTraveler]

Finally received EIDL grant on the vacation rental. Even though we listed 0 employees we received $1000. Would have preferred $2000 to cover both DH and I as employees, however better than nothing.

Has anyone found a good resource on what items we can spend EIDL grant for? I don't believe it has all of the payroll limitations of the PPP but don't want to mess this up.

 

[CalGalTraveler]

Thankfully many Tuggers got in under the wire and received their grants and loans.

SBA Lowers EIDL Amounts Plus Limits New Applications - Miles to Memories

The Small Business Administration has reportedly lowered the maximum loan limit for the Economic Injury Disaster Loan Program by more than 90%.

milestomemories.com

Here is the underlying Wash Post article. It might be behind a paywall (sorry!)

https://www.washingtonpost.com/business/2020/05/07/sba-disaster-loans/

 

[easyrider]

Finally received EIDL grant on the vacation rental. Even though we listed 0 employees we received $1000. Would have preferred $2000 to cover both DH and I as employees, however better than nothing.

Has anyone found a good resource on what items we can spend EIDL grant for? I don't believe it has all of the payroll limitations of the PPP but don't want to mess this up.

Because it is $1000 instead of $10,000 I don't think it matters what you spend it on because you will likely have enough business expense to cover $1000.

The SBA is now approving loans. I just received my approved loan application this morning. I had thought the loans would be for up to $2 million but it seems the pre-approval is going to be under $150,000 for most applicants and applicants that had only 1 employee listed on the EDIL will likely be pre-approved for under $50,000. The terms are 30 years at 3.75% which is very good for any loan, imo. I submitted my application this morning.

Bill

 

[CalGalTraveler]

Because it is $1000 instead of $10,000 I don't think it matters what you spend it on because you will likely have enough business expense to cover $1000.

The SBA is now approving loans. I just received my approved loan application this morning. I had thought the loans would be for up to $2 million but it seems the pre-approval is going to be under $150,000 for most applicants and applicants that had only 1 employee listed on the EDIL will likely be pre-approved for under $50,000. The terms are 30 years at 3.75% which is very good for any loan, imo. I submitted my application this morning.

Bill

LOL...true! No lack of expenses it takes $20k a year to operate that vacation rental.

I haven't heard anything since we received the EIDL grant. Are we supposed to submit more info for the loan? or will they contact me?

I am most interested in the EIDL to PPP rollover for 1% loan but cannot find simplified details on how this all works.

 

[TravelTime]

LOL...true! No lack of expenses it takes $20k a year to operate that vacation rental.

I haven't heard anything since we received the EIDL grant. Are we supposed to submit more info for the loan? or will they contact me?

I am most interested in the EIDL to PPP rollover for 1% loan but cannot find simplified details on how this all works.

I am wondering what you mean by the EIDL to PPP rollover? I have not heard about this. I thought each loan was separate and you had to apply for each one separately. That is what I did.

 

[CalGalTraveler]

You do apply separately but they mention that you can refinance your EIDL into a PPP loan. Cannot find details.

 

[TravelTime]

You do apply separately but they mention that you can refinance your EIDL into a PPP loan. Cannot find details.

Okay I have not heard of this. I just googled “refinance EIDL PPP” and found some information on it but maybe it is not the details you are looking for.

 

[Miss Marty]

Citi's Response to COVID-19

Using Proceeds from the Paycheck Protection Program
to Support Small Businesses and CDFls

Citi is donating the net profits earned through our participation in the U.S. Small Business Administration's Paycheck Protection Program (PPP) to fund an expansion to the Citi Foundation's $7.5 million COVID-19 U.S. Small Business Relief Program. Read more about Citi's commitment to customers and clients.

More info

Paycheck Protection Program - Citi.com

The Paycheck Protection Program supplies small businesses with forgivable loans to cover employee payroll expenses, due to the COVID-19 crisis.

online.citi.com

 

[dioxide45]

. I submitted my application this morning.

I thought the SBA was only accepting agricultural purpose EIDL at this time?

 

[easyrider]

LOL...true! No lack of expenses it takes $20k a year to operate that vacation rental.

I haven't heard anything since we received the EIDL grant. Are we supposed to submit more info for the loan? or will they contact me?

I am most interested in the EIDL to PPP rollover for 1% loan but cannot find simplified details on how this all works.

When you apply for the EIDL there is a box to check that says you would like a loan. This is not the EIDL but a regular SBA loan with good terms. The terms were 30 years @ 3.75%.

If you checked the box on the EDIL application that you want a SBA loan they should be sending you a pre-approval loan email. We didn't use the PPP so I don't have a clue.

Bill

 

[easyrider]

I thought the SBA was only accepting agricultural purpose EIDL at this time?

Yes, the EIDL is only for agriculture sector as of now but the regular SBA loans are starting to process.

Bill

 

[easyrider]

The SBA loan approval was followed up by an email today from a loan officer. The problem is I couldn't verify who I would be communicating with. The email looks legit but there are many fraudulent legit looking emails. The link to the SBA on the email doesn't open.

My application number for the EIDL is correct on this email meaning that who ever did send this email has access to my SBA loan number.

So I did call the number on the email and spoke with the loan officer. He did have all of my information. Seem's legit but he lacked the SBA employee identification number. I then called the SBA and spoke with a person with an identification number and they looked the person up and he is legit.

So I guess the loan is off to the next step as the person I spoke with was verifying my information.

Bill

 

[easyrider]

I opened my email and found that our SBA loan has been approved. The terms are very good regarding business loans. There is a $100 fee that is taken from the loan. The loan has an interest rate of 3.75% and a term of 30 years. The loan I am looking at requires collateral. Loans under $25,000 do not require collateral. We have 60 days to accept.

Even though the pandemic has caused a loss of income, things are getting better. We probably will not take the loan unless something really odd economically happens in the next 30 days.

I have also read that the EIDL that was originally meant to give $10,000 but only gave $1,000 per employee claimed should be giving the full amount to those that had a partial payment.

Bill

 

[CalGalTraveler]

That's great news @easyrider I still haven't received any communication about the loan except the EIDL grant money (no complaints ).

A friend in agriculture had to fill out all of the forms which came within 24 hours last week. They are now withholding grant money until all the forms are complete. He believes that the webpage wasn't built at the time I applied in April. He was approved for the loan quickly but no grant yet.

Do you think that we could expect the full $10,000 grant if we got less? If so can you provide information that confirms this? That would go a long way if it did.

 

[TravelTime]

I read today in Wall Street Journal that the treasury is changing the guidelines for the PPP to make it more useable for small businesses. It is likely they will say it can be used for more than just payroll (ie lower the rules that 75% of PPP must be used for payroll) and that they will expand its use beyond 8 weeks. The interest rate on PPP is just 1%. So I am curious why a business would take an EIDL loan over a PPP loan, since the EIDL has a higher interest rate compared to the PPP? I applied for both in order to get the $10K grant from EIDL but I will reject the EIDL loan if I am approved for it.

 

[easyrider]

I read today in Wall Street Journal that the treasury is changing the guidelines for the PPP to make it more useable for small businesses. It is likely they will say it can be used for more than just payroll (ie lower the rules that 75% of PPP must be used for payroll) and that they will expand its use beyond 8 weeks. The interest rate on PPP is just 1%. So I am curious why a business would take an EIDL loan over a PPP loan, since the EIDL has a higher interest rate compared to the PPP? I applied for both in order to get the $10K grant from EIDL but I will reject the EIDL loan if I am approved for it.

Maybe I will look into the PPP a bit closer. We did have payroll and utilities but no mortgage or rent expenses is why I didn't apply.

Bill

 

[easyrider]

Do you think that we could expect the full $10,000 grant if we got less? If so can you provide information that confirms this? That would go a long way if it did.

I wouldn't hold your breath, lol. It seems that Congress doesn't have the final say in this but some people think it may happen.

Bill

 

[CalGalTraveler]

I don't think it will happen either, just wondering if you heard otherwise.

PPP is a better loan but limited to payroll with many complicated rules and limitations. EIDL more flexible. If the PPP could cover more than payroll and for more than 2 months then it could significantly help us with our vacation rental business because there is no formal payroll. Not sure we need the EIDL but will apply when they finally reach out to us and decide later.

 

[TravelTime]

I don't think it will happen either, just wondering if you heard otherwise.

PPP is a better loan but limited to payroll with many complicated rules and limitations. EIDL more flexible. If the PPP could cover more than payroll and for more than 2 months then it could significantly help us with our vacation rental business because there is no formal payroll. Not sure we need the EIDL but will apply when they finally reach out to us and decide later.

These are the changes that the Treasury is considering making to the PPP. We should hear soon if they make these changes.

 

[easyrider]

Ok. I read up on the PPP again and the main reason we didn't go for the PPP is that even though it can be a forgivable loan and the interest rate is 1%, the term on any part of the loan that isn't forgiven is two years after you receive it.

That said, I see that Bank of America is now taking applications so I plan to check it out. It looks like the payroll costs and utilities are enough to have the loan forgiven if the loan is under $11,000.

Thanks for the remind to check it out.

Bill

 

[easyrider]

In regards to the EIDL program we had decided to think about this loan for a while. After finding out the requirements to use the funds we were planning on not accepting the loan. As it turns out , the over sight requirements last three years. We decided to take the loan as a three year cushion. Who knows what will happen in the next three years with covid 19.

It seems it would be better to have the loan now while we don't need it than to not be able to get it if we did need it.

Bill

 

[easyrider]

The EDIL is now re-opened to everyone. If you didn't get in on this its pretty simple. You need to have a side hustle like renting timeshares or almost anything legal. The application takes 10 minutes at most to fill out. The first part of the loan you receive is actually a grant for $1000 per employee. Many people that rent timeshares are a couple so put two employees on that line. The SBA can offer you a loan after you receive the grant.

Bill

COVID-19 Economic Injury Disaster Loan | U.S. Small Business Administration

covid19relief.sba.gov

 

[easyrider]

I signed the EIDL documents for the SBA loan on Monday via docu-sign and the funds showed up in the account this morning. This is not the grant but the SBA loan that you can get after the emergency grant.

The things I like about this loan is the only cost besides the low interest rate is the $100 third party fee that they deducted from the loan. The first payment is in 12 months. The loan can be paid off early. The 30 year term is unheard of regarding business loans. The speed of expediting the loan by the SBA was very fast.

Things I don't like are the possible oversight requirements. The SBA docs say they can request receipts and not will require receipts, so we will see.

Bill

 

[pedro47]

Good luck easyrider, these are some tough time. Please spend your money wisely.

 

[easyrider]

Good luck easyrider, these are some tough time. Please spend your money wisely.

I do spend wisely. The proof is I'm here at TUG, lol.

The requirement for spending the EIDL is that the loan can only be used for operating expenses. The SBA can ask for receipts to prove the business is spending the loan on operating expenses. A business can use the EIDL to pay the operating expenses every month which will enable the business to use their earnings elsewhere.

Bill