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TSBDC at Volunteer State Community College
As of 4/6/2020
 
Below is a list of my bullet points.  There’s a ton of info out there and this is my best effort to clarify it.
 
And I apologize for all of the “to the best of my knowledge” disclaimers below.  A lot of the information out there has changed recently and continues to be fluid.
 
Here is the most current link for the SBA Loans for Coronavirus Relief.
 
 
ECONOMIC INJURY DISASTER LOAN FOR COVID-19 (EIDL)
You can apply for the EIDL loan with this link - https://covid19relief.sba.gov/#/
 
  • This loan has a possible advance up to $10k that is based on the number of employees you have ($1k/employee) and the SBA is currently saying you will not have to repay the advance.
  • To the best of my knowledge this is a 30-year term, 3.75% rate, with up to a year deferred loan.  That information is no longer on the SBA website though, so I’m not sure if they are changing it.
  • There is not a way to request the amount of money that you want to borrow and to the best of my knowledge, nobody has received funding from this loan yet.
 
As far as I understand, whatever portion of the EIDL advance that you accept, it will be deducted from the non-repayment portion of the PPP loan, if you get the PPP loan.
 
 
PAYCHECK PROTECTION PROGRAM (PPP)
Paycheck Protection Program info (application form included, but has to be turned into your bank or a participating SBA lender bank) - https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program-ppp
  • You can apply for PPP through a bank (start with your bank first).  You may soon be able to apply through Intuit as well - https://quickbooks.intuit.com/small-business/coronavirus/paycheck-protection-program/
  • The loan is the equivalent to 2.5 times your average monthly payroll for 2019.  If your business started in 2020, the average for January and February.  To the best of my knowledge this includes yourself and it doesn’t include independent contractors since they can apply for the loan too.
  • Funds are provided in the form of loans that can be fully forgiven for an 8 week period (from when the loan is first disbursed) when employees are kept on the payroll and 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.)  You will have to provide the proper paperwork when the time comes to have the loan forgiven.
  • Whatever is not forgiven will be converted into a 2-year loan with a 1% rate.
 
It looks like you can get possibly get both of the two loan options EIDL and PPP, but only PPP can be used for payroll if you do that. 
 
There is also a line on the PPP application asking about the “Refinance of Eligible Economic Injury Disaster Loan, net of Advance (if Applicable; see Paycheck Protection Program Rule)”.  I’m not sure if that means when you get the EIDL if you have to refinance it or if you have the option to do it.
 
Lastly, here is the Interim Final Rule for PPP - https://www.sba.gov/sites/default/files/2020-04/PPP--IFRN%20FINAL_0.pdf
 
Feel free to email with any questions and I’ll help the best that I can.

Charles Alexander
Director
Tennessee Small Business Development Center
Volunteer State Community College
1480 Nashville Pike
300 Building Office 103C
Gallatin, TN 37066
Ph: (615) 230-4780
Fax: (615) 230-3362
charles.alexander@volstate.edu
www.tsbdc.org

Funded in part through a cooperative agreement with the U.S. Small Business Administration.  All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA.  All SBA programs are extended to the public on a nondiscriminatory basis. All opinions, conclusions, or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA and other program sponsors. All information is deemed reliable, but not guaranteed. All information, events, and/or prices are subject to change or withdrawal. The Tennessee Small Business Development Centers Network shall not be held responsible for any typographical errors, misinformation, or misprints. Please confirm the information with the listing party. Reasonable accommodations for persons with disabilities will be made if requested at least two weeks in advance. Contact your local center or our state office at 3050 Medical Center Parkway, Murfreesboro, TN 37129 or call toll free at 1-877-898-3900.
Tennessee Small Business Development Center
At Volunteer State Community College
1480 Nashville Pike | Gallatin, TN 37066
615-452-8600
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