You may have heard that the SBA (U.S. Small Business Administration) is offering low-interest federal disaster loans to businesses impacted by COVID-19. A total of $50bn will be made available – $8.3bn of that funding has already been approved and while the remaining $42bn+ is still pending approval from Congress, that is likely to happen in the coming weeks. Many small businesses in the U.S. travel industry may qualify for assistance.
There’s a lot of information out there, and it can be tough to digest, so here’s an up-to-date breakdown of how to find out if you’re eligible, how to apply, and other useful links and details.
How do I find out if my state/territory is eligible for SBA Disaster Loan assistance?
[UPDATE]: All 50 states plus inhabited territories of the U.S. (American Samoa, Guam, Nothern Mariana Islands, Puerto Rico, U.S. Virgin Islands) are now eligible to apply for SBA disaster loans.
What are the terms of these loans?
Size / purpose: The SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance. This may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact.
Interest rate: 3.75% for small businesses.
Term: Long-term repayments are likely in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
I think I’m eligible – how do I apply?
You’ll need to have the following documentation in order to apply:
- Business Loan Application (SBA Form 5)
- IRS Form 4506-T
- Complete copies of your company’s most recent Federal income tax returns
- Personal Financial Statement (SBA Form 413)
- Schedule of Liabilities (SBA Form 2022)
After you apply, your credit will be reviewed and an SBA verifier will estimate the total physical loss to your business. A decision should be made within 2-3 weeks. Note: This may take longer than usual given the substantial increase in demand from the COVID-19 pandemic.
This simple PDF goes into the step-by-step process in more detail, along with other documentation you may need.
You can also get in touch with the SBA through the following channels:
Email: [email protected]
Here at Peek we’ll provide periodic updates on which states/territories are eligible for COVID-19 SBA loans. To find more useful resources for tour operators regarding COVID-19, you can visit our resources page here – it includes best practices, advice from industry experts and ways to stay connected with the community.
If you need any support, don’t hesitate to reach out to our Partner Support team. We’re here for you 24/7.
The Team at Peek
Note: Please remember that Peek is not a certified financial advisor, and we cannot offer financial advice for you and your business. Our goal is simply to share information that is already out there in an easy-to-digest way so that you have all the tools you need to make important decisions for your business.