Business of all sizes are facing financial strain in the face of COVID-19. The Economic Injury Disaster loan program can provide federal business loans with funding up to $2 million for qualifying businesses. Learn more about this program and the application process in this video with John Geraci.
Good afternoon. It’s John Geraci, Managing Partner at LGA, and we wanted to take a couple of minutes to share with our colleagues, clients and friends, some disaster relief that’s been provided by the federal government to help businesses that have been affected by COVID-19. Obviously a lot of businesses have had significant disruptions and will continue to have significant disruptions resulting in lost revenue and profit. This is going to create undue hardships on businesses. The federal government now has programs available to help fund ,through loans, those lost profits to get us through to the other side of all of this. They have put a program in place. It’s the Economic Injury Disaster loan program which provides funding, loans, up to $2 million for taxpayers and businesses that have been impacted by COVID-19. You have to show need, and to show need, you have to demonstrate through prior historical financial statements, what your historical sales and profits have been so that they can determine what an appropriate amount to loan you would be.
In addition, they look at the owners, the business owners, personal financial statement to understand whether or not the owner has the wherewithal to actually help subsidize some of the impact of lost business. So when it comes to filling out these forms, it can be a somewhat onerous process. You clearly need to pay attention to the details in this process. For example, if you’re completing your personal financial statement, the asset value of your investment portfolio would have been much higher on 12/31 than it is today, post the impact of COVID -19 on our stock markets. And so you want to go through this process diligently compile your information and submit it. The interest rates are very reasonable. For small businesses that qualify, it should be approximately 3.75%. For nonprofits that qualify, it’s 2.75% and you can stretch the term of these loans out over a fairly significant amount of time.
Now these funds again are going to be made available based on need. So you have to demonstrate need and you also have to demonstrate that there was an actual loss that’s occurred. So lots of information for you to take in and you’re hearing it from a lot of different sources. To the extent that LGA can be of any assistance to you in compiling this information or filling out the application, please don’t hesitate to reach out to me, John Geraci, my email address will be included in the email that we send out, firstname.lastname@example.org and we look forward to helping you secure whatever financing we can to help get you through this process. Thank you.