Self-Employed Contractors and Small-Business Owners Can Get Emergency Relief

If you are a business owner, self-employed, an owner-operator, a contractor or nonprofit affected by the current pandemic-related economic crisis, the government is offering you assistance. But get it before it's gone.

The Small Business Administration (SBA) is offering several special economic assistance programs in response to the current national emergency. While people usually think of small businesses as those with fewer than 500 employees, these special programs are also available to sole proprietorships, independent contractors, the self-employed and 501(c)(19) veterans organizations or other private nonprofits.

The new programs can give you grants to cover payroll expenses and up to $10,000 for additional expenses, often in as little as 72 hours.

Here is a list of some of the new emergency programs available. If you think you are eligible for any of them, apply quickly. Demand is sure to be high.

Paycheck Protection Program (PPP)

This is a loan designed to help small businesses keep workers on the payroll. Loans are available for up to $10 million, or 2.5 times your total payroll expenses based on the average of your last eight weeks' payroll plus 25%.

Loan payments are deferred for six months. The loan has an interest rate of 0.5% and a maturity of two years. No collateral is required, and there are no fees.

The SBA will totally forgive the loan if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest or utilities.

The Paycheck Protection Program will be available through June 30, 2020.

Economic Injury Disaster Advance Loan

The Economic Injury Disaster Advance Loan (EIDL) has been around for years; however, there are new, looser guidelines as a result of the current situation.

The EIDL is available for up to $2 million with a term of 30 years and interest rates of 3.75% for small business and 2.75% for nonprofits. The first payment is deferred for 12 months from the date of issue.

EIDLs smaller than $200,000 can be approved without a personal guarantee, and real estate is not required as collateral. Funds will be made available within three days of application.

Up to $10,000 can be forgiven if that money is spent on paid leave, maintaining payroll, increased costs due to supply chain issues, mortgage or lease payments or other obligations that can't be met due to revenue loss.

SBA Debt Relief

For those with an existing SBA loan who are affected by the current emergency, the SBA may pay the principal and interest of those loans for up to six months.

SBA Express Bridge Loans

The Express Bridge Loan Pilot Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with reduced paperwork.

Check out the SBA's website for more information on these and other financial assistance resources, as well as to apply for them.

Get the Latest Financial Tips

Whether you're trying to balance your budget, build up your credit, select a good life insurance program or are gearing up for a home purchase, Military.com has you covered. Subscribe to Military.com and get the latest military benefit updates and tips delivered straight to your inbox.