Businesses have suffered major losses throughout 2020 and it seems that trend is continuing into 2021. Economic downturn has businesses struggling to make a profit, leaving many owners no choice but to let their employees go and shut down. The government is doing what it can to help small businesses survive. One of those ways is the Paycheck Protection Program (PPP). You can find out what type of businesses qualify for this loan by searching online.

There are some important things to know about the PPP loan, such as the possible loan amounts and deadline to apply. An online search can help answer all of your questions.

Keep on reading to find out if you qualify for the paycheck protection loan.

What Is the PPP Loan?

According to Fortune, nearly 10,000 businesses permanently closed down in 2020. To keep more businesses from becoming part of this statistic for 2021, the Paycheck Protection Program encourages business owners to use the money to keep workers on payroll and pay for necessary expenses.

The money from this loan can be used to fund employee payroll costs and benefits. Other expenses that can be covered with the loan include:

• Mortgage interest;
• Rent;
• Utilities;
• Uninsured property damage, and;
• Other costs required to keep a business in operation.

Businesses can receive up to 2.5 times the average monthly payroll costs with a maximum of $10 million. If you’re applying for a second PPP loan, the maximum is capped at 2.5 times the average monthly payroll with a $2 million maximum.

There is an exemption for accommodation and food service that have been particularly hard hit. They can borrow up to 3.5 times the average monthly payroll costs with a second PPP loan.

What Are the Qualifications?

There’s some important things to understand before applying for a PPP loan. First, you need to know if you qualify.

Businesses who have not yet received a loan will be applying as a first-time applicant. The U.S. Small Business Administration (SBA) says the following entities may be eligible for a PPP loan:

• Sole proprietors, independent contractors, and self employed persons.
• Any small business concern that meets SBA’s size standards.
  • Any business, non-profit organization, veterans organization, or tribal business concern with the greater of:
    500 employees, or;
  • That meets the SBA industry size standard of more than 500.
• Any business with a NAICS code that begins with 72 (Accommodations and Food and Services) that has more than one physical location and employs less than 500 per location.

It’s possible for businesses to apply for a second PPP loan, also known as a Second Draw PPP loan. This loan has the same general terms as the First Draw PPP loan. The SBA says borrowers are generally eligible for a second loan if they:

• Previously received a First Draw PPP loan;
• Has no more than 300 employees, and;
• Can demonstrate at least a 25 percent reduction in gross receipts between comparable quarters in 2019 and 2020.

How to Apply for a PPP Loan

The deadline to apply for a PPP loan is May 31, 2021. The process to apply is relatively straightforward, whether you’re a first-time applicant or Second Draw PPP applicant. As long as you apply before the deadline and meet the qualifications, your business could receive a loan.

Start the application process through Lender Match. You will take about five minutes to answer questions about your business. In two days, you will receive an email with contact information from potential lenders interested in loaning your business money. This will give you a chance to compare the various lender rates, terms, and fees.

Then, you can submit the necessary loan applications and paperwork. There is a checklist of information a lender might be interested in knowing before offering you a loan. This includes:

• A business plan;
• Amount and use of funds;
• Credit history;
• Financial projections;
• Collateral, and;
• Industry experience.

Search Online to Learn More About PPP Loans

If you’re a struggling business owner, it might be time to apply for a PPP loan. The money can keep your employees on payroll and cover other expenses necessary to keep everything up and running. Those who have already applied for the loan may also qualify for a second one.

Remember, the deadline to apply is May 31, 2021. Search online to learn more about who qualifies for the loan and how the application process works. The money could be a way for your business to survive these uncertain economic times, so consider taking advantage of this program while it’s still around.