The Coronavirus or Covid19 has been sweeping the world with unprecedented economic hardship and health consequences. In some ways it has brought the world closer together as we experience the same situations and face this challenge together.
As a Small Business Owner who may have had to cease or reduce operations and have no or limited revenue stream until the crisis is over, what are your options for receiving HELP? This post will share some tips and resources for you to explore and further the path to getting back on your feet.
UPDATED INFO ON LOANS:
Received this from a business lender: As of the time of this writing, March 29, 2020, the SBA has not formalized the application process for the new “Paycheck Protection Program” or “PPP”, the program that got signed into law Friday as part of the $2 Trillion CARES Act. At the moment, we are all waiting for guidance. Once I get clarity on that, I will likely fill you in with another update. Businesses CAN apply right now for the Economic Injury Disaster Loan…it is an application you can file on line direct with the SBA and do not need another lender involved….go to https://www.sba.gov/funding-programs/disaster-assistance to apply.
Here is a link with a helpful run down on the SBA assistance loans that are currently available: https://files.constantcontact.com/27483c98001/ab3a54bd-48b0-423b-b845-cb3d2ed735e8.pdf
And another link to help you understand what you qualify for: https://files.constantcontact.com/27483c98001/5549b8bb-7ea1-4c06-9817-28d88045dfce.pdf
Keep in mind, that there is a HUGE demand for all of these products as most businesses are affected in some way over this virus. So there is going to be delays at SBA and especially with the banks and lenders who will be called on to administer the new PPP Loans. So be patient.
LOANS AND FINANCIAL AID
The SBA has loans available under the Disaster Relief Act from the Federal Government. https://disasterloan.sba.gov/ela/
Your COUNTY needs to be listed on the Disaster Loan Application site for the SBA for Covid Declared Disasters. If your county is NOT listed, we encourage you to contact your Governor’s Office via phone and email and ask them to submit ALL counties for their state so people can get financial help. The Governor is the only one who can request for the counties to be added.
You will need to indicate ECONOMIC INJURY as the reason for filing.
Some states have funding and even municipalities so please check on your state and local government websites to see what they have for funding assistance. Some of the funding is for government entities only, some may be for brick and mortar stores/shops/restaurants forced to close.
BEWARE of predatory money lenders who are hard-money loan sharks looking to capitalize on “desperation.” These lenders usually charge very HIGH interest rates with possible daily payouts and should only be used as a last resort after other options have been exhausted.
BUSINESS INTERRUPTION INSURANCE
You may be eligible for Business Interruption Insurance from your business insurance carrier. You need to review your policy or have your insurance agent help you with this to see if the Covid19 is covered. KMRD Partners shared via webinar what to do with insurance and questions to ask your carrier.
The video is here: https://www.facebook.com/178677998855566/posts/3140169152706421/
You need to keep good records of any economic hardship you are facing as a result of the Covid19 shutdown. Know the payouts will not be quick and as with any agency, they will probably try to dispute your claim to avoid paying out on the policy. KMRD has offered to assist those who may need help with their policies whether or not they are policies set up through KMRD. They are our ADVOCATE for insurance coverage.
KMRD Partners, Inc. 2600 Kelly Road, Suite 120 Warrington, PA 18976 866-957-5673 http://www.kmrdpartners.com
DEFERRED PAYMENT PLANS
We encourage you to reach out to any creditors you owe money to and ask for a reprieve for payments. MOST entities are being understanding and will defer payment for 1-2 months with a provision to contact them if more time is needed.
IF your bank, auto loan, credit card companies, lenders, property managers are NOT being cooperative, we suggest sending that information to the Governor of your State and also to your local news station. This is a time when EVERYONE need to be helped to the degree they are impacted and for entities to take a hard line on offering any support or assistance is not right. These companies need to be exposed. The pressure they receive might make them change their attitudes and approach to their customers.
Ask your creditors what they are offering
Negotiate terms that work for you
Keep track of what you have agreed to so you know when your payments will resume and at what amounts
Stay in touch with all of your creditors – they like communication and most are available via phone and email.
WHAT ABOUT MY CLIENTS AND PROPERTIES WHERE I HAVE MY STAGING FURNISHINGS INSTALLED?
If you are getting calls to waive payments for your furnishings, you have a right to not lose the income. You can agree to the terms providing the seller/client has enough equity in the home to pay the deferred amount at closing. We do NOT recommend going to a pay at close option for the duration – agree to only 2 weeks or 1 month and then re-assess.
The prediction is clients will resume their jobs and income once the Covid19 crisis is over – and current estimates are by mid-April we will be able to resume our business activity. Your other option is to pick up your items and return them to your warehouse for use in future projects. If the property gets put on temporary-withdraw status, this means the house will be put back to active showings once the crisis is over and real estate activity can resume to normal.
IF the house is still listed online, you should be paid for your items that are being used to showcase the house. You can decide if you will charge a reduced amount as a courtesy. You have a legal agreement in place with your client that needs to be honored however if you are able to adjust things to work with your client that will go a long way for future business opportunities.
IF the house is de-listed temporarily, this is where you can defer use fee for 2 weeks and then resume payments. We are not charities and as micro-businesses we are not in a position to lose income as we have bills to pay as well. Make sure to keep track of lost income.
IF the house is removed from active listing altogether – pick up your items. Make sure to keep on top of important dates such as when the REALTOR no longer has access or you no longer have access, etc.
Check with the listing agent on the strategy – the sellers may be moving back, they may decide to rent, or other options. You don’t want to let your things sit at risk when a contract has been terminated.
Houses are still being purchased and sold which means sellers are still able to get their house to close during this time.
You want to make SURE you submit your invoice to the TITLE company with clear instructions on how you are to be paid.
Ask the client who that entity is for the transaction or;
Ask the REALTOR who is handling the sale about the Title Company. Make sure the REALTOR knows what your plan is so they are in the loop.
Call the Title Company and explain what you need to do – and ask about any other payouts on the property to ensure there will be revenue left to pay you.
Stay on top of the CLOSING DATE and the day prior, call the Title Company to ensure you are on the LIST for payout/settlement.
If you do choose to waive payments and let items remain in a house, make sure to KEEP TRACK OF ALL LOST INCOME as that would be part of the Economic Injury Claim.
We hope the information shared is helpful to you and answers questions you may have regarding how to deal with our current, unprecedented situation. For more information or to contact us please email firstname.lastname@example.org