SBA incentives
Mike Metzger
Helping small to mid-market business owners sell their privately held companies / Business Brokerage / Speaker / Veteran
I continue to be amazed at the incentives that the SBA is offering to purchasers of small business. Bottom line . . . there's no better time to buy a small business! I've included some of the most recent program updates below:
Debt Relief Payments for SBA 7(a) and 504 Loans (Economic Aid Act Section 1112 - as of February 16, 2021)
The SBA will make regular loan payments for borrowers on all new loans approved by the SBA between February 1, 2021, and September 30, 2021, for up to a 3-month period up to $9,000/month once the loan is fully funded. (subject to availability of funds) For loans closed on September 27, 2020, or before, the SBA will make an additional 2 months of payments for the borrower (up to $9,000/month).
For businesses assigned with NAICS codes beginning with 61, 71, 72, 213, 315, 448, 451, 481, 485, 487, 511, 512, 515, 532, or 812, the SBA will make regular monthly loan payments for up to an additional 3-month period, starting after the 2-month period defined above, for a total of 5 months of payments (up to $9,000/month).
Borrowers whose loan closed on September 27, 2020, or before that had not fully funded by that date will get 3 months of payments starting after their loan fully funds. These loans will not be eligible for a second round of payment.
*Subject to budget limitations
The payments made by the SBA will be payments based on the current payment schedule of the loan – principal and interest or interest only and eligible associated fees, for eligible current and newly funded SBA Loans. The SBA payments are not a deferment. They act as if a borrower made the scheduled payment. Borrowers not need to take any action to receive benefits from the Debt Relief Fund.