You may be eligible for a loan under the paycheck protection program if the coronavirus affected your business operations. Here is some helpful information about the program.
What Is the Paycheck Protection Program?
The paycheck protection program is a special program created by the government to assist businesses in paying their payroll and other expenses during hardship related to the coronavirus. The PPP program is part of the CARES Act and the Small Business Association backs it.
Eligibility for a PPP loan
The good news about the PPP program is that all businesses affected by the coronavirus are eligible. Sole proprietors, as well as independent contractors and self-employed individuals, can qualify the same as other small businesses.
No one needs to feel left out from this amazing program. PPP lenders from Lantern are ready and willing to help business owners gain approval and receive the funding they deserve.
What Can a PPP Loan Be Used For?
According to the experts at Lantern Credit, a PPP loan can be used for a vast assortment of purposes. A borrower can use the funds to pay payroll expenses so that the workers can continue to service the community and earn pay.
PPP loans can also be used for equipment expenses, building rental fees, mortgage payments, utilities, and the like. Borrowers can also use the funds for property damages and operating expenses. Any of these expenses is acceptable, as long as they apply to running and maintaining the business.
How Can I Apply for the Paycheck Protection Program?
The best way to apply for the paycheck protection program is to contact a reputable third-party lender and apply using its online process. Not all lenders are SBA-approved lenders. Therefore, you’ll need to use a tool to find the ones that are.
How Much PPP Funding Can I Receive?
The cap on a PPP loan is $2 million. You can receive up to 2.5 times your monthly average payroll costs for the year preceding your application. You can receive 3.5 times that amount if your business is in the food or accommodations realm.
Duration of Loan
PPP loans generally last for two years and have a low interest rate of 1 percent. Some loans have a five-year duration. You can speak to a lending agent to find out more about the loan length.
How Much of My Loan Will Be Forgiven?
One of the largest benefits of PPP loans is that they can be forgiven over time. You can apply for loan forgiveness after you’ve spent 60 percent of the loan proceeds and within the 24 week period of your application date.
You’ll need to show that you spent the money on business-related purposes, primarily payroll. You must also ensure that you will keep a certain number of full-time employees on your payroll. You’ll have the option to apply for forgiveness through the lender. The lender will then take up to 60 days to reach a decision.
The amount that you can be forgiven depends on how much of the loan you spend on payroll. You could get 100 percent of the loan forgiven if you meet those requirements. Otherwise, you may be eligible to receive forgiveness for a percentage of the loan.