Explore COVID-19 relief programs for small businesses with Protect Law Group. Discover how PPP and EIDL can support your recovery—get help today!
Book a Consultation CallThe COVID-19 pandemic has profoundly impacted small businesses across the nation, leading to unprecedented challenges and financial hardships. To combat these issues, the federal government introduced various relief programs aimed at providing financial assistance to eligible businesses.
Protect Law Group will delve into key SBA programs related to pandemic relief, focusing on the Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL). By understanding these business debt relief resources, small business owners can navigate recovery more effectively.
As of late 2023, various updates and adjustments have been made to both PPP and EIDL programs to reflect the evolving landscape of economic recovery. Small business owners should stay informed about any new guidelines or extensions offered by the SBA, as these can significantly impact their ability to access business debt relief.
The Paycheck Protection Program (PPP) was designed to help small businesses maintain their workforce during the COVID-19 crisis. By offering forgivable loans to cover payroll expenses, the program aimed to ensure employees remained on the job. Businesses could apply for loans amounting to 2.5 times their average monthly payroll costs, which significantly aided companies struggling to pay their staff during lockdowns and reduced operations. SBA loan lawyers were able to make a profound difference for their clients.
Eligibility for PPP loans was broad, but specific criteria had to be met. Small businesses with fewer than 500 employees, self-employed individuals, and certain non-profits were eligible to apply. It's essential to note that applicants needed to demonstrate that the pandemic negatively affected their business operations, reinforcing the loan's intended purpose of providing much-needed support during tough times.
One of the standout features of PPP loans was their potential for forgiveness. To have their loans forgiven, businesses needed to use at least 60% of funds for payroll costs, while the remaining 40% could cover rent, utilities, and mortgage interest. By following proper procedures and maintaining employee retention, businesses could effectively turn their loans into grants, greatly alleviating financial burdens.
In addition to PPP loans, the Economic Injury Disaster Loan (EIDL) program served as another crucial resource for small business debt relief during the pandemic. EIDLs were designed to provide working capital to cover operational expenses and help businesses regain their financial footing. These low-interest loans became vital for businesses struggling to meet their financial obligations due to pandemic-related disruptions.
To qualify for EIDLs, businesses had to demonstrate substantial economic injury caused by the pandemic, which could include reduced revenue and increased expenses. The application process required businesses to provide essential financial information, including profit and loss statements. As a result, understanding the necessary documentation upfront helped expedite the application process. SBA loan lawyers can help businesses navigate this paperwork.
By leveraging these resources, business owners can better navigate recovery and adapt to a post-pandemic world. Staying informed about current business debt relief is crucial for long-term success, and small business owners should continue to explore their options as they seek to regain stability and growth. Contact Protect Law Group for more detailed information and guidance.
Millions of Dollars in SBA Debts Resolved via Offer in Compromise and Negotiated Repayment Agreements without our Clients filing for Bankruptcy or Facing Home Foreclosure
Millions of Dollars in Treasury Debts Defended Against via AWG Hearings, Treasury Offset Program Resolution, Cross-servicing Disputes, Private Collection Agency Representation, Compromise Offers and Negotiated Repayment Agreements
Our Attorneys are Authorized by the Agency Practice Act to Represent Federal Debtors Nationwide before the SBA, The SBA Office of Hearings and Appeals, the Treasury Department, and the Bureau of Fiscal Service.
Our firm successfully resolved an SBA 7(a) loan default in the amount of $140,000 on behalf of a husband-and-wife guarantor pair. The business had closed following a prolonged decline in revenue, leaving the borrowers personally liable for the remaining balance.
After conducting a comprehensive financial analysis and preparing a detailed SBA Offer in Compromise (SBA OIC) package, we negotiated directly with the SBA and the lender to achieve a settlement for $70,000 — just 50% of the outstanding balance. This settlement released the borrowers from further personal liability and allowed them to move forward without the threat of enforced collection.
Our firm successfully resolved an SBA COVID-19 Economic Injury Disaster Loan (EIDL) in the original amount of $150,000 for a Florida-based borrower. The loan, issued on June 4, 2020, was secured by business assets and potential personal liability through the SBA's Security Agreement.
Following the permanent closure of the business, we guided the client through the SBA’s Business Closure Review process and prepared a comprehensive collateral analysis. We negotiated directly with the SBA, obtaining a full release of the business collateral for $2,910 — satisfying the borrower’s obligations under the Security Agreement and eliminating any further enforcement risk against the pledged assets.
Client personally guaranteed SBA 7(a) loan for $150,000. COVID-19 caused the business to fail, and the loan went into default with a balance of $133,000. Client initially hired a non-attorney consultant to negotiate an OIC. The SBA summarily rejected the ineligible OIC and the debt was referred to Treasury’s ureau of Fiscal Service for enforced collection in the debt amount of $195,000. We were hired to intervene and initiated discovery for SBA and Fiscal Service records. We were able to recall the case from Fiscal Service back to the SBA. We then negotiated a structured workout with favorable terms that saves the client approximately $198,000 over the agreed-upon workout term by waiving contractual and statutory administrative fees, collection costs, penalties, and interest.
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