Disaster loans available for small businesses
By CHRISTINE HAINES
chaines@yourmvi.com
Unlike a natural disaster, the coronavirus state of emergency has no defined borders, but disaster relief is expected to be forthcoming.
“Every business has been impacted. Our normal day and life, nothing is normal,” said Ray Vargo, director of the Small Business Development Center in Pittsburgh.
Disaster relief loans through the Small Business Administration have been approved for every county in Pennsylvania, and Vargo is urging local businesses to be proactive.
“I would encourage all of the small businesses who are impacted by this to take a look at our resource page,” he said. “If a business has a question of what the next step is, they can call us.”
While the office is closed, consultants are working remotely and the phones and emails are still being answered. The office normally handles 1,200 clients, but Vargo expects that number to increase substantially in the coming months.
“Our information we’re receiving from the SBA is that they will have the capital to assist small businesses, but it will be in the form of loans,” he said.
Vargo said that while no category of business is totally unaffected by the coronavirus impact, places such as beauty salons and retail shops have hit hard under the forced closure ordered by Gov. Tom Wolf.
“The business owners should be talking to their resource partners — their banks they have their loans with, their attorneys,” Vargo said.
SBA’s Economic Injury Disaster Loans, available to businesses in all 67 Pennsylvania counties, offer up to $2 million in assistance and can provide economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
The loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact.
The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.
SBA offers loans with long-term repayments 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.
Businesses may obtain information and loan applications by calling the SBA’s Customer Service Center at 1-800-659-2955 (1-800-877-8339 for the hearing impaired), or by emailing disastercustomerservice@sba.gov.
Loan applications can also be downloaded at www.sba.gov/disaster.
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