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    The University of Georgia’s Small Business Development Center (SBDC) has partnered with the Georgia Department of Community Affairs (DCA) to provide a series of webinars to help small businesses and community leaders navigate the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

    The CARES Act provided $349 billion to help small businesses keep workers employed amid the COVID-19 Pandemic. The CARES Act provides funding for the Paycheck Protection Program, modifies the existing Economic Injury Disaster Loan (EIDL) program, and provides immediate loan payment relief for current SBA 7(a) borrowers.

    SBA Guaranteed Loan Payment Relief:  SBA will pay the principal, interest, and associated fees on guaranteed loans. For existing borrowers not in deferment, the SBA will pay six months beginning with the next payment due on the loan. For existing borrowers on deferment, the SBA will cover six months of payments beginning with the first payment due after the deferment period.  For a new borrower, the SBA will cover the first six months of payments, but only for new loans made within the first six months starting from the date of enactment.

    Economic Injury Disaster Loan (EIDL): Available for companies with 500 employees or fewer, this loan provides funding up to $2 million. Loans are based on credit score and have a 3.75% interest rate. The first 12 payments will be deferred and the loan term can be up to 30 years plus one year of deferment.

    Economic Injury Disaster Loan Advance: The advance is a $10,000 advance on the EIDL loan provided to businesses applying to the EIDL.  Eligible businesses are small businesses in operation on January 31, 2020. The advance will be delivered within several days of applying for it. Businesses can get the advance even if they are not awarded the EIDL and it does not need to be paid back. The advance will be deducted from the loan amount of the EIDL and can be used to pay sick leave for employees, maintain payroll, meet production costs due to supply chain disruptions, pay business obligations including debts, rent, and mortgage payments. If a business had previously applied for the EIDL using the old forms, they must reapply for the advance using the short form on the sba.gov website.

    Small Business “Paycheck Protection Program” (PPP): This loan will be available to small businesses defined by SBA size standards, generally up to 500 employees, but depending on sector. The interest rate of this loan will not exceed 4% but is currently fixed at 1%. The SBA’s “no credit elsewhere” test is waived for this program and for loans under $200,000 no personal guarantee is required. The loan can be for amounts up to $10 million but must be used to pay workers, maintain payroll, pay mortgage, lease, or utilities and 75% of the loan amount must go to workers. Loan forgiveness is reduced by layoffs or if employees’ pay reduction is in excess of 25%. Loan forgiveness is not treated as taxable income.

    Please visit www.georgia.sbc.org for more information and also to access a program comparison chart to determine which loan is more applicable/beneficial.