How small business owners can get loans amid economic crisis

NEW YORK — “It has been challenging, very challenging.”

Small business owner Rechelle Balanzat of Juliette Laundry has worked hard to keep her 24-hour laundry business afloat to ensure that her employees continue to have jobs during the pandemic.

But when the U.S. Small Business Administration started offering programs aimed to help business owners with payroll – Balanzat said she encountered challenges.

“It’s been incredibly difficult to access any type of EIDL, PPP, or any type of assistance from the government.”

In the 23rd District of Texas, Gina Ortiz Jones, who is running for a seat in the U.S. Congress, hosted a virtual town hall on the economic impact of COVID-19 on small businesses.

Jones — who recently bagged an endorsement from former presidential candidate Pete Buttigieg — discussed LiftFund, a nonprofit organization that partners with the SBA to provide paycheck protection program, or PPP, loans to small businesses amid the pandemic.

“Janie and Celine are going to talk about the work that they’ve done to get some of the relief assistance through the PPP program into our small business – again, the engine of our economy, unfortunately, have borne the brunt of what happening here.”

“The beauty of the program, as it relates to small business, as the economic engines of our communities is that if we document everything, it actually becomes a forgivable loan,” said Celina Pena.

It means small businesses who qualified for PPP need not pay back the COVID-19 “loan.”

“The rules are, that you have to use it for payroll, 75% for payroll, 25% for these other things called a mortgage, rent, utilities and interest. If you’re not gonna provide that data to us the next 8 weeks, because we’re gonna require that paperwork, then don’t apply because it will turn into a term loan for two years — that term loan for two years at 1%,” said Janie Barrera.

But those with bad credit are denied loans.

“If you are delinquent on taxes, or on student loans, any federal program that’s out there that you’ve kind of slowed on it. If you’re delinquent, period, if it shows on your credit report as delinquent.”

Another basis for disqualification is if the applicant has a federal incarceration record in the last five years.

The loan is also taxable.

If it’s forgiven, there is a tax form that comes with the forgiveness.

Finally, only U.S. citizens are eligible to apply for PPP.

No Comment

Leave a Reply