By: Sarah Pape

If your business is suffering financial hardship due to COVID-19, there are options for financial assistance available to you. This article summarizes some of the options available to small businesses as of now. Keep in mind that the federal government stimulus package is still in negotiation and is expected to provide additional relief and programs for both individuals and businesses. We will provide updates as more information becomes available.

Economic Injury Disaster Loans (U.S. Small Business Administration)

If your business is suffering working capital losses due to COVID-19, then you may qualify for an Economic Injury Disaster Loan (EIDL) from the United States Small Business Administration (SBA).  EIDLs are available to small businesses directly affected by COVID-19. Most non-profits organizations are also eligible to apply. The loans being offered through the EIDL program are for amounts up to $2 million, with interest rates of 3.75% (2.75% for nonprofit organizations), and terms up to 30 years.  The loans can be used to pay fixed debt, payroll, accounts payable, and other bills that could have been paid had the COVID-19 disaster not occurred. You can apply online at DisasterLoan.sba.gov. There is no cost to apply and no obligation to accept the loan if it is offered to you.

Emergency Bridge Loans (Florida Department of Economic Opportunity)

The Florida Department of Economic Opportunity has also made emergency loans available to small businesses. Like EIDLs, Emergency Bridge Loans are available to small businesses who have suffered economic losses as a result of COVID-19. Emergency Bridge Loans are short term, designed to assist a business temporarily until it can secure more permanent form of financing. As such, the loans are interest free for a one-year loan term. After that, the interest rate is 12% per annum on the unpaid balance.  The maximum amount of the loan is $50,000. You can apply online at  http://www.floridajobs.org/rebuildflorida/businessrecovery.

Loan Deferment

If you have existing loans and are experiencing difficulty making your payments, options are also available to you.

If you currently have a 7(a) or 504 SBA loan, you can apply for a deferment on your loan payments.  Deferments assist borrowers who are experiencing temporary cash flow issues. Deferment typically provides a lower monthly payment amount for a specified period of time.  After the deferment period ends, there is a “catch up” period where monthly payments are increased to make up for the deferred payments. Lenders can typically grant deferments of payments for up to 6 months, depending on the circumstances. You should contact your lender for more information.

If you have a traditional loan with a private lender, and you are having cash flow issues due to COVID-19, you should contact your lender and ask for options. Many lenders are willing to work with their borrowers in times of financial crisis, and it is important to keep the lines of communication open.