x
Breaking News
More () »

Maine's Leading Local News: Weather, Traffic, Sports and more | Maine | NewsCenterMaine.com

Maine small businesses can apply for 'forgivable loans' during the coronavirus pandemic

The 'paycheck protection program' is part of a nearly $350 billion federal relief program while businesses try and navigate the coronavirus, COVID-19 world

PORTLAND, Maine — Small businesses in Maine reeling from huge losses during the coronavirus pandemic can now officially apply for a new forgivable loan to help keep their business afloat.

Loan applications for the 'paycheck protection program' went online at midnight Friday. It's part of a nearly $350 billion federal government relief program approved by Congress a week ago. But the process got off to a rough start because banks only received 31 pages of final guidance Thursday night. 

The Maine Bankers Association represents 30 different banks throughout the state. Officials say it will take time before the program is fully functioning. Lenders also have a lot of questions for the Small Business Administration (SBA) on how to process the applications.

Paperwork for the loans is available through the SBA website. Businesses with up to 500 employees can apply and need to work with a participating SBA lender, bank, or credit union. 

RELATED: Q&A: How small businesses hit by coronavirus crisis can get aid starting Friday

All loan payments will be deferred for six months, but the SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used to pay for wages, rent mortgage interest or utilities.

Companies can borrow up to two and a half times their monthly payroll. The association says members are seeing a tremendous volume in applications for loans from businesses, which could help them recover and possibly reopen in the future. 

The demand at this point is extraordinary and trying to figure out the process that could deliver the results congress wants will be the challenge', said Chris Pinkham, the President of the Maine Bankers Association.

To apply for a 'forgivable loan' click here or go to SBA.gov

Businesses must show lenders proof that their company was in operation on Feb. 15, 2020, and that you had employees for whom you paid salaries and payroll taxes.

In addition, you'll need to show proof of your average monthly payroll costs in 2019 (or for the first two months this year if your business is new).

Independent contractors and the self-employed, who must wait until April 10 to apply, need to show proof of "payroll and other certain expenses" according to Treasury.

RELATED: Help on the way for small businesses struggling to survive the coronavirus crisis

RELATED: Businesses may get COVID-19 relief loans as soon as Friday

RELATED: Trump signs $2.2T stimulus after swift congressional votes

At NEWS CENTER Maine, we’re focusing our news coverage on the facts and not the fear around the illness. To see our full coverage, visit our coronavirus section, here: /coronavirus

NEWS CENTER Maine Coronavirus Coverage

RELATED: WATCH LIVE: White House Coronavirus Task Force giving update

RELATED: Mills and Maine Delegation put pressure on Defense Dept. over health concerns for BIW workers

RELATED: Gov. Janet Mills orders all travelers coming to Maine quarantine for 14 days

RELATED: Face masks now recommended, though Trump says he won't wear one

RELATED: Maine Coronavirus Live Blog: 9 dead, 432 confirmed cases