COVID-19 Small Business Loans and Other Resources
This article was written by Texas Legal Services Center and applies only to COVID-19 related SBA loans. For the most updated information, please review the Office of the Texas Governor's FAQs for Texas Businesses.
As 2020 comes to an end, so to do many of the Small Business Assistance Programs that were implemented to assist businesses impacted by Covid-19. Though some of the programs have closed, some remain open. America’s Small Business Development Center (SBDC) has created a spreadsheet that compares all of the currently available SBA programs. You can access the spreadsheet here and find more information about SBDC resources here.
Small Business Administration (SBA) loans are small-business loans guaranteed by the SBA and issued by participating lenders, primarily banks. SBA loans rates and terms typically better for borrowers than other types of financing.
As a result of COVID-19 the government is offering statewide SBA Economic Injury Disaster Loans (SBA EIDL). These are low-interest loans for small businesses, most private non-private organizations, and small agricultural cooperatives suffering substantial economic injury due to COVID-19.
As of December 2020, EIDL applications remain open. You can apply and find more information here.
EIDL Loans are available to small businesses who have been in operation since January 31, 2020. An EIDL is available even if you can secure credit elsewhere. An EIDL can be used to pay fixed debts, payroll, accounts payable, and other bills that the business cannot pay due to COVID-19. The loans are available in a maximum abount of $2 million. The interest rate is 3.75% for small businesses and 2.75% for non-profits with terms up to 30 years. Loans over $200,000 must be guaranteed by any owner having a 20% or greater interest in the business. An applicant may request an expedited disbursement paid withing 3 days of the request.
The Paycheck Protection Program is a program that makes loans of up to $10 million available to certain qualified small businesses. A loan under this program is 100% federally guaranteed and fully forgiven if the funds are used for payroll costs (at least 75% of the loan must be used for payroll), interest on mortgages, rent, and utilities. Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Review this FAQ on Paycheck Protection Program Loans.
Note as of December 2020 applications for PPP are currently closed. For more information, click here.
A SBA Express Bridge Loan allows a small bsuiness who currently has a business relationship with an SBA Express Lender to access up to $25,000 quickly. An SBA Express Bridge Loan can be a term loan or used to bridge the gap while applying for a direct EIDL or other loans.
For more information on SBA Express Bridge Loans and how to apply, please click here.
Note that as of December 2020, SBA Express Bridge Loans remain open.
More information on SBA Bridge Loans can be found here.
The SBA is providing debt relief assistance to small businesses during this pandemic. For more information on debt relief assistance, please click here.
Note that debt relief remains open until December 31, 2020.
Community Development Financial Institutions (CDFIs) is another resource that might be able to assist you financially. CDFIs are specialized community based financial institutions that provide financial assistance primarily in low income communities. You can use this CDFI locator to search for CDFI offices in Texas.
There may also be local and regional resources available in your area. You will need to check with your local banks and other economic development organizations for resources. Below is a list of cities in Texas and available resources in the area.
All Texas businesses should sign up for the Office of the Texas Governor COVID-19 related updates. You can sign up for updates here.
The SBA offers a counseling tool for finding small business assistance in your area. You can use the link here to find small business counseling in your area.
Please also use the following links for the most current information and resources available.