Many companies are running into some very serious financial hardships due to the Coronavirus. Some are headed for outright financial ruin.
Many have already applied for the $10,000 Economic Injury Disaster Loan. Companies have mounting obligations; such as bills, rent and employees (who are now not receiving pay). Plans and events have been canceled. Buyers are now cautions and are pulling back and/or outright canceling prior purchase commitments.
Time is of the essence.
Owners have not received an email from the SBA after applying for the $10,000 relief money which has left many left sitting in a quiet isolation of awe, wonder and desperate hope.
To make matters worse, now there are computer issues at the Small Business Administration.
Brock Blake, CEO of Lendio, a marketplace for loans, also said he was hearing complaints about the SBA’s computer system from bankers. He tried to put customer applications in himself as a test.
“I tried to submit one application in the morning and it was circling for eight hours. I couldn’t submit hundreds of applications,” Blake said.
There is also a conundrum about the stipulations of the loan document terms. Each loan requires a note which contains legally binding clauses between the lender/borrower.
The industry has not received specific guidance on whether to make up their own stipulation language within the notes or simply use the government’s legal mumbo jumbo. This is where things are stuck legally.
One small legal “oops” can make any loan application ineligible.
2020. You gotta love it.
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