Who can help me get an SBA / PPP emergency stimulus loan? (2021 updates)

In this 5-minute read:

  • What businesses are eligible for emergency SBA/PPP loans?
  • Who can help me get an SBA loan?
  • How do I know which lenders are eligible SBA loan providers?
  • What are lenders looking for?

IMPORTANT UPDATE FOR 2021: Congress has approved an extension of the PPP loan program. Applications may be submitted to SBA through May 31, 2021, including “second draw” PPP loans for businesses that received PPP funding in 2020. Please read more details about PPP for 2021

Businesses across the country (and the world really) are still facing financial challenges as a result of the COVID-19 pandemic. The government has responded with Trillions of dollars in stimulus packages for small businesses, continuing into 2021.

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Originally authorized under the CARES Act of 2020, small businesses were now be able to get loans under the Paycheck Protection Program (PPP), EIDL, or other emergency SBA loans and grants. These sources of funding were meant to help businesses stay afloat and continue to pay their employees. These programs have run out of money several times and been “re-funded” again and again, with the extended deadline for PPP loan applications now set at May 31, 2021.

However, there may be some confusion as to how your business can apply for and access these loans. This article will help guide you in the right direction for SBA emergency loans. 

What businesses qualify for SBA emergency loans?

Generally speaking, all American businesses with fewer than 500 employees may qualify for SBA emergency loans under the PPP. This includes non-profits, independent contractors, tribal businesses, and others that meet the SBA’s size standards. For second-draw PPP loans, you must have fewer than 300 employees and meet other requirements. 

Depending on the size of the loan that you are seeking and where your business is located, there may be additional requirements as well. 

Because of the many caveats and various requirements, several organizations have stepped up to become facilitators in helping small businesses acquire the right loans for them during this crisis. 

Go deeper: Read about whether you can get a PPP loan for new business ventures in 2021.

You may also like: PPP loan for independent contractors 2021

Who can help my business get a small business stimulus loan?

The SBA has approved hundreds of private lenders to fulfill PPP loans to small businesses.

We have found several institutions and organizations to help guide you through the process. 

Federally insured entities

Any federally insured depository institution, federally insured credit unions, or Farm Credit System that is participating in the Paycheck Protection Program can help you apply for a loan for your business. 

Personal banks

Personal banks and lenders can also help guide you through the application process for PPP loans. Again, they must be participating in the Paycheck Protection Plan in order to provide this service. 

Other private companies

Several private lenders and organizations that are dedicated to helping small businesses are also becoming facilitators for SBA emergency loans. While not all organizations in this program can directly lend to you, they can help you find the right connections to ensure that you are finding a credible source for your emergency loan. 

Womply can help you get your PPP application submitted!

Womply has helped over 200,000 businesses, independent contractors, sole proprietors, and eligible self-employed individuals with their PPP loans… for free!

tablet with approved SBA PPP loan

How do I know if a lender is eligible and part of the Paycheck Protection Program?

It’s important to be wary of the different lenders out there. While we have seen so much good in the world as businesses and communities come together to help one another through this crisis, there are others who may try to take advantage of the situation. 

Be cautious as you seek out lenders for your SBA emergency loans and be certain that they are eligible participants of the Paycheck Protection Program. 

Many organizations are still waiting for the final approval to become verified lenders of these emergency loans. 

Check with your bank or a lender you trust to see if they are offering this service or will be soon. If not, that is when reaching out to a company like Womply that helps connect businesses to eligible lenders can be helpful. 

When I find an SBA approved lender, what will they need from me?

As you are searching for a lender or working with an SBA loan facilitator to pair your business up with the right lender, there are a few things you may want to be aware of before you apply for your PPP loan. 

Unlike traditional business loans, PPP loans do not require any kind of collateral. But there are other requirements in order to ensure that your business deserves this loan. 

Lenders are going to ask for good-faith verification of the following:

  • The loan request is necessary for your business due to the challenges of current economic conditions
  • Loan proceeds will be used for maintaining payroll or making other essential payments like mortgage, rent, and utilities
  • You don’t have a loan application pending already for the same purpose
  • You haven’t already received a similar loan for the purpose and amounts of this one

Beyond these good-faith answers, you’ll also need to fill out the application and provide payroll documentation to ensure that the loan gets to the right business. 

We recommend preparing for the application process by gathering the following, at a minimum:

  1. W-9 Tax ID document
  2. Proof of being operational by 2/15/2020 (You may be able to confirm this with the payroll records from a period that includes 2/15/2020 or a payroll summary.)
  3. 2018, 2019, and 2020 tax returns (or latest available)
  4. Legal documents for your business (Charter, state licenses, Articles of organization)
  5. Payroll records for Jan 1, 2019, to present (Forms 940 and/or 941)
  6. A list of all owners with greater than 20% ownership stakes in your business
  7. Online banking credentials. This will be used to verify ownership if you are approved for a loan.
  8. Clean up your books. To apply for loan forgiveness in the future, you’ll need to document the expenses you pay during the 8-24 week period after you receive an SBA PPP loan. Make sure you’re prepared to document expenses, including payroll, mortgage interest, and/or rent and utilities.

You may also like: Will a PPP loan affect my credit?

Go deeper: Can you apply for PPP twice?

How much can I borrow under the Paycheck Protection Program?

One question on every business owner’s mind is likely this: how much of a loan can I get?

Each business can apply for loans up to 2.5 times their average monthly payroll costs or up to $10 million (whichever is less) for first-draw PPP loans. For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. For borrowers in the Accommodation and Food Services sector (click HERE for NAICS 72 to confirm), the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs, up to $2 million. 

This allows business owners to keep paying their employees and keep business operations running as much as possible for the next few months. Please note: PPP loans are forgivable (basically they become grants that you don’t have to repay) if you use them for payroll or other approved PPP expenses.

Go deeper: How your business should spend your PPP / SBA loan money

Read more: Do you have to pay the PPP loan back?

Not a U.S. Citizen? Read this: Can I apply for PPP with ITIN?

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