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Financial Relief from Bank Loans Information: For businesses with Small Business Administration (SBA) loans who may need relief: Contact your bank and request a deferment. Your bank has unilateral authority to provide temporary relief in the form of a deferment.
With unilateral authority, your bank can act without SBA approval. Banks can defer your loan for up to three or six months.
Here are tips on seeking a deferment:
Be prepared: Have your recent tax returns, your interim financials (Income Statement and Balance Sheet), bank statements and a written statement defining the impact to your business.
Ask the right people: When you contact your SBA lender, your best contact person is the SBA servicing department.
Be persistent: Access to capital is your lifeline and your willingness to persist in the face of apparent hurdles is important.
For businesses without an SBA loan or those in need of working capital due to substantial economic injury, contact your local SBA District Office and consider applying for a Coronavirus (COVID-19) Disaster Relief Loan. These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75%. SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
To find your local SBA District Office, click here. Note: these loans are being established in connection with state-issued Emergency Declarations and the details are being rolled out now. Businesses with SBA loans and who seek additional capital: Your best option here is to first seek a deferment and then apply for a Disaster Relief Loan.
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