Where can I apply for the Paycheck Protection Program?
You can apply for the Paycheck Protection Program (PPP) at any lending institution that is approved to participate in the program through the existing U.S. Small Business Administration (SBA) 7(a) lending program and additional lenders approved by the Department of Treasury. This could be the bank you already use, or a nearby bank. There are thousands of banks that already participate in the SBA’s lending programs, including numerous community banks. You do not have to visit any government institution to apply for the program. You can call your bank or find SBA-approved lenders in your area.
When can I apply?
- Small businesses and sole proprietorships will be able to apply for the Paycheck Protection Program loans as soon as April 3rd, 2020. Loans will be given on a first-come, first-served basis.
- Independent contractors and self-employed can apply starting April 10th, 2020.
- A new loan from the SBA is available until June 30th, 2020.
- Application Form
Who is eligible for the loan?
You are eligible for a loan if you are:
- A small business that employs 500 employees or fewer.
- A restaurant, hotel, or a business that falls within the North American Industry Classification System (NAICS) code 72, “Accommodation and Food Services,” and each of your locations has 500 employees or fewer.
- Tribal businesses, 501(c)(19) veteran organizations, and 501(c)(3) nonprofits, including religious organizations.
- Independently owned franchises with under 500 employees, who are approved by SBA.
How much can be borrowed?
The Paycheck Protection Program provides small businesses loans that can be up to 2.5 times the borrower’s average monthly payroll costs. The amount that can be borrowed tops out at $10 million. The date range for calculating that average cost is different for seasonal businesses, nonseasonal businesses, and firms that opened in 2020.
- Loan Size: Can provide up to $5 million of capital for small businesses
- Loan Term: Have loan terms of up to 10 years for working capital and 25 years for real estate
- Interest Rates: Most loans currently have interest rates between 7.75% and 10.25% depending on loan size and maturity
- Loan Use: Can be used for working capital, equipment, buying a business or franchise, refinancing debt, and purchasing real estate
- Credit Requirement: Typically require a credit score of around 680
- Down Payments: Usually require a 10% to 20% down payment, as well as a certain amount of collateral
- Timing: SBA 7(a) loans can be approved in between 1-10 days, depending on the lender
For detailed terms and condition of the PPP Loan Program, refer to PPP-Borrower Information- Fact Sheet.