Self-employed individuals and independent contractors became eligible on April 10 to apply for the Paycheck Protection Program, or PPP. The loans are available to cover up to eight weeks of average monthly payroll plus 25%. Highlights include:
maximum loan amount is $10 million with a fixed 1% interest rate and maturity of two years.
Eligible recipients may qualify for a loan determined by eight weeks of prior average payroll. Payroll costs include salary, commissions, tips; certain employee benefits including sick leave and health care premiums, and state and local taxes.
There is no collateral required, no SBA fees, no personal guarantees, and no credit elsewhere test.
Loan payments will be deferred for six months.
SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
The program will be available through June 30.
Business owners can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Find a Minnesota PPP lender here.
Find PPP program details, FAQ's, guidance for faith based organizations, and more, as well as other SBA relief programs at www.sba.gov/coronavirus.