Paycheck Protection Program Loan (PPL) and Economic Injury Disaster Loan (EIDL) Frequently Asked Questions
I don’t need a loan, why would I apply?
These are called loans but they are actually GRANTS and they are perfect for small funeral homes. The EIDL gives you $10,000 instantly and the PPL gives you 2.5x your monthly payroll (providing you use the money to pay your employees and keep them on staff)
Do I need to put up Collateral?
Are there any fees?
Do I need to personally guarantee the loan?
Do I have to pay the loan back?
No for the $10,000 EIDL loan and No for the PPL loan so long as you use the money as described by the Small Business Administration (SBA)
“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). 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.”
Am I Eligible?
Any small business with less than 500 employees that has not defaulted on prior SBA loans is eligible. That makes this loan perfect for every family owned funeral home in the country.
The fund is out of money, Am I Too Late?
No, there is a very high likelihood that Congress will add another $250 billion to the program. It is best to get your application in Now
I pled guilty to a felony years ago, am I still Eligible?
Businesses are only ineligible if an owner of 20 percent or more of the equity of the applicant is presently incarcerated, on probation, on parole
Should I apply for both programs?
Yes. They are separate. EIDL is a $10,000 grant to small businesses and does not negatively impact your ability to get a Paycheck Protection Loan. The PPL is a loan that does NOT have to be repaid so long as you use the funds to pay your employees, rent and electricity. APPLY ASAP. The EIDL can be done if 10 minutes with basic information.
Where do I apply for EIDL?
You apply for the EIDL directly on the SBA website. It is easy and only takes a few minutes. If you have less than 500 employees, you are eligible. Click here for the EIDL application
Where do I apply for the PPL?
Go to your local banker. Think small. Larger banks appear to be buried in applications. Smaller local community banks appear to have an edge. Plus, it supports other small business leaders in your community. Click here to review the SBA terms.
What is the time frame to get these loans?
The government is overwhelmed. Apply today and hope for the best. These are supposed to be fast.
What about documentation?
You will need basic information for both loans, but nothing extensive. Your banker is making the loan but is not responsible if you default. Hence they are less concerned about verifying paperwork. The bankers are just going to quickly review your calculations. This is a direct quote from the SBA to the lenders….
“Lenders are expected to perform a good-faith review, in a reasonable time, of the borrower’s calculations and supporting documents concerning average monthly payroll cost.”
Some of my employees are 1099, can I use their income in the calculation?
Yes. A 1099 employee’s pay can be added to your payroll
What about outside contractors that are not on my payroll?
No, outside contractors, where you pay another small business, are eligible to file themselves and you can not count them in our payroll. This includes landscapers, painters, etc.
Should I hire someone?
It is not necessary to pay someone to help you here. The forms are simple. If you do pay your accountant or lawyer to help, do it fast and DO NOT give them a percentage. Pay them by the hour as you always do. This is 2 hours worth of work at best. Scammers are coming at small businesses for this money. It is yours.
When should I apply?
ASAP. The government has only funded these loans for a short time and money is running out. Congress has said they will allocate another $250 Billion to the program, but who knows if that will happen