navigate the confusing application process. & nbsp; “Data-reactid =” 16 “> The Trump administration’s payment protection program, worth $ 349 billion, was launched last Friday to provide emergency loans to small American businesses devastated by the coronavirus, if business owners can navigate the confusing application process.
Banks were scheduled to start accepting applications as of Friday, but very few banks had their online portals operational at that time. Once they did, they were quickly inundated with apps. Bank of America received 10,000 loan requests within the first hour.
Jovita Carranza tweeted that the number was 17,500 loans.) “Data-reactid =” 18 “> As of Monday morning, Bank of America had received 177,000 requests for a total of $ 32.6 billion in loans, or nearly 10% of the 349 billion dollars allocated. Small Business Administration has not publicly updated request totals since Friday evening when the SBA administrator Jovita Carranza Tweeted that the account was for 17,500 loans.)
BAC) has been criticized for initially rejecting applicants who did not have existing commercial loans with the bank, a qualification BofA now says it has waived, as long as the applicants have no borrowing relationships with another bank. “Data-reactid =” 19 “> Bank of America (BAC) has been criticized for initially rejecting applicants who did not have existing commercial loans with the bank, a qualification that BofA now says it has lifted, both that applicants do not have a borrowing relationship with another bank.
WFC) now says it will focus on businesses with fewer than 50 employees because its demands exceed its Fed $ 10 billion loan limit. “Data-reactid =” 20 “> Loans are supposed to be open to companies with fewer than 500 employees, but Wells Fargo (WFC) now says it will focus on companies with fewer than 50 employees because its demands exceed its Fed loan limit of $ 10 billion.
President Trump highlighted the PPP at his coronavirus task force press conference on Monday evening: “It works really well,” he said. “Some little glitches. Minor issues that have already been resolved. He added that the administration will probably have to add more money to the PPP package.
880-page document that some small business owners have attempted to analyze for advice. “Data-reactid =” 22 “> The 349 billion dollars set aside for PPP loans is part of the CARES law (Coronavirus Aid, Relief, and Economic Security) 880-page document that some small business owners have tried to ‘analyze for advice.
Independent entrepreneurs (who are all employees of small businesses) must apply for PPP loans individually, a separate process that begins on April 10. “Data-reactid =” 23 “> Yahoo Finance spoke to three small business owners on Monday who shared their frustrating experiences when applying for PPP loans. A problem they all shared: the lack of clarity that independent entrepreneurs (who many employees of small businesses have to) apply for PPP loans individually, through a separate process that begins on April 10.
Here are their stories.
You may not think dog walking is very high on the list of priority companies needing financial relief in this crisis, but for dog owners who work full time, this is normally an essential service. . And it’s a business that has stopped operating while families stay at home.
Gold Coast Pet Care, based in Jersey City, New Jersey, was launched in 2014 and has five employees, including Josh and Jessica Klein, the married co-founders. (The company was also hiring a sixth person just before the coronavirus struck.) Josh Klein says that Gold Coast normally takes about 60 walks a day, pre-coronavirus, and is now down to ten, while so many of his clients stay at home and don’t need the service.
“We have a few clients who work from home, no matter what is going on in the world, and they initially kept their visits on schedule,” said Klein. “But it has really gone down over time and things have gotten scary. We have a handful of customers who have offered to continue paying even if they don’t want us to come because they want us to survive this. ”
asked for unemployment thanks to the newly reduced requirements; applied for an EIDL (Economic Injury Disaster Loan), an SBA loan option prior to the coronavirus; and applied for a loan via PPP. “Data-reactid =” 50 “> The Kleins have taken three measures of financial relief and have yet to receive a dollar from any of these steps: applied for unemployment through newly reduced requirements; requested an EIDL (Economic Injury Disaster Loan), an SBA loan option prior to the coronavirus, and requested a loan via PPP.
The Kleins applied through Chase, where they had an existing business account. But three of Gold Coast’s employees are independent contractors (1,099 workers), who must apply for PPP loans separately; business owners are not expected to include 1099 workers in their payroll when applying.
It was not immediately clear to many business owners who applied for the first day.
“Where the problem comes from, in my view, is not all the independent entrepreneurs who have been doing this for 15 years and who have made their living,” says Klein. “I can tell you for sure that none of our teams has a separate corporate account. So they will have to apply by themselves, and everything we tried to do last Friday could have been a waste of time. “
Coronavirus and job loss: what is a leave or a layoff?]“Data-reactid =” 78 “>[Readmore:[Readmore:[Lirelasuite:[Readmore:Coronavirus and job loss: what is a leave or a layoff?]
Nevertheless, Klein received a confirmation from Chase that he applied, and an email which, as Klein sums up, says, “Don’t call us to check, we’ll call you. “
The next step for Gold Coast, if not approved for a PPP loan, is to create a GoFundMe page.
Dani Babb’s company, The Babb Group, in Newport Beach, California, is helping colleges switch courses in-person to online, a technology service that you think would actually benefit from coronavirus. But because of the distance, “They’re not in their offices to pay us,” says Babb. “They want us to do the work now, with the promise of future payments. And almost always, this business goes through a tender [request for proposals] process which can take 6 to 12 months. So the colleges say to the teachers, find out for yourself. It will probably be at the end of the summer before we see any requests that will not come from our existing customers. “
Babb has 18 employees, 13 of whom are independent contractors. Like Klein, it was not clear to her at the start that the distinction would require separate requests, so she had to repeat her PPP request to count only her full-time employees.
“Friday was a nightmare,” she says. “I have been banking with BofA for 15 years, I have a pay account with them and a checking account, but not a loan relationship. When I signed in, it told me that you are not eligible because you do not have a credit card or loan relationship. Then they gave in to pressure online and on Saturday morning they let us apply, but it will go in order of priority, so now I think I’m at the bottom of the list. ”
Babb saw on Twitter that a number of small banks are responding to customer complaints and encouraging frustrated applicants to check them instead, so it now has several backup requests with small banks in case Bank of America l would not approve.
guest on Yahoo Finance in the past, auctioning items like the famous Honus Wagner baseball card “jumbo” T206.) “data-reactid =” 89 “> Goldin’s company Ken Goldin, based in Runnemede, in New Jersey sells authentic sports memorabilia at auction and has 19 full-time employees. (Goldin has been a guest on Yahoo Finance in the past, auctioning items like the famous T206 “jumbo” baseball card Honus Wagner.)
Goldin Auctions is a consignment company, so they normally have someone at their office everyday to accept items. “It hasn’t happened in a month,” says Goldin. “So our next auction in May is something we have had for three months. The real impact will be visible in three months. “
Goldin is honest about his company’s position relative to other companies in the midst of this crisis: “I sell collectibles, and we sell to the wealthy with discretionary income. I don’t sell toilet paper, Purell, paper towels, or groceries, so I know I don’t sell anything that anyone absolutely needs. But if I don’t get [a PPP loan], I’m going to have to make cuts that I don’t want to make. ”
On Thursday, the day before the P3 process began, Goldin contacted the company’s main bank, TD AmeriTrade, and learned that it would not be ready to process the loans on Friday. He got the same response from Bank of America, where he also has a business account, and Wells Fargo, where he has a personal account.
“My contact at TD was very helpful and said he didn’t know how anyone was going to be able to accept this since the forms had changed the day before,” said Goldin. On Friday, he heard of the exception for 1,099 workers, who represent about 25% of his payroll.
“An individual is an older man out of state, in his 70s, we are his only source of income, but he certainly does not have a business,” said Goldin. “How can they do it themselves?” “
Goldin finally submitted his loan via TD AmeriTrade and was only told that his request had been submitted successfully and he would be contacted within the next three to five business days.
10% of the loans already available. What if this thing runs out? “” Data-reactid = “116”> “My biggest fear is that there is an error in our application,” he says. “And I continue to see these big numbers saying that Bank of America has put 10% of the loans available. What if this thing runs out? ”
readDanwrite.“Data-reactid =” 118 “>Daniel Roberts is editor in chief at Yahoo Finance. Follow him on Twitter at @readDanwrite.
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