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Covid-Related Small Business Loans: What You Need to Know

Small businesses everywhere are feeling the sting of the world-wide Covid-19 pandemic. Many manufacturing businesses have come to a screeching halt as demand has dried up for everything other than groceries it seems. As a small business ourselves, Wakefield Equipment is facing the same economic pressures as our customers. We’ve put together this resource of current small business loans to help our manufacturing customers get the financial relief we all need.

SBA Paycheck Protection Program Loans (PPP)

The U.S. Small Business Administration (SBA) is offering small business loans with low interest rates to those suffering as a result of the Coronavirus. The requirements for PPP loans are simpler than other SBA loans in the past. Your business only needs to fulfill 2 criteria:

  • Your business was in operation as of February 15, 2020
  • You’re an independent contractor or sole proprietor, or your business/organization has either employees or independent contractors for whom they have associated payroll costs

PPP loans will help small businesses maintain payrolls and continue necessary payments like rent and utilities. The loan can be used to pay:

  • Payroll costs: Compensation in the form of salaries, wages, commissions (or similar compensation), cash tip payments (or the equivalent)
  • Healthcare costs: Any costs related to the continuation of group healthcare benefits, including insurance premiums
  • Mortgage interest payments (but not payments on the mortgage principal)
  • Rent
  • Utilities
  • Interest on any other debt obligations incurred before February 15, 2020

PPP loans are eligible to be forgiven, up to 100% of the loan principal if the funds are used appropriately. In simpler terms: you won’t have to pay the loan back if you use the money  the way the program has approved. You will not have to pay back any amounts used during the first 8 weeks of the loan if they are used to pay:

  • Payroll costs
  • Mortgage interest payments (but not payments on the principal)
  • Rent
  • Utilities

It gets a little more complicated that no more than 25% of the forgiven amount can be for non-payroll costs (i.e., mortgage interest, rent, and utilities). If your business has laid off employees, that will also affect how much your loan can be forgiven. The total effect on your PPP loan’s forgiveness-eligibility depends on some complicated math so it’s important to apply as soon as possible through a lender that you have a current business banking relationship with so they can walk you through exact amounts.

Quick Tips from Wakefield’s Experience:

  • It’s ideal if you can choose a lender that you already have an existing banking relationship with. Hopefully it’s a local bank so you can get better customer service. The large banks are already inundated with applications and are likely not taking more.
  • You will be required to provide that banking information in order to receive funds
  • You need to be incorporated and will be required to provide that documentation
  • Have all of your paperwork ready: tax returns for 2019, documentation showing how you have been negatively impacted by COVID such as a sales forecast and payroll reports
  • Only apply through ONE bank

The first round of funding for the PPP was used up quickly and the second round of funding is anticipated to run out just as quickly. The program is expected to be approved with additional applications being accepted beginning on 4/24/20.

As soon as you are done reading this article, go to and search for a lender that you have a banking relationship with already. Apply immediately! It is likely the funding will run out quickly.

SBA’s Economic Injury Disaster Loan Program

In response to the Coronavirus (COVID-19) pandemic, small business owners are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000, which will NOT have to be repaid. This advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue (source:

In order to qualify, you must have fewer than 500 employees and have been in business on or before January 31, 2020. The loans can be taken out for up to $2 million, but only the $10,000 advance does not have to be repaid.

Loans can be used by small businesses for a variety of expenses. These include providing paid sick leave, payroll, meeting production costs, paying rent or mortgages on business spaces and anything else to help with the continuity of the business.

Like the PPP program, the initial funding for the loans was quickly used up and the next round of funding is anticipated to be approved on 4/23/20. In order to apply, visit to determine your eligibility. But GO FAST!

SBA Loan Relief

If you are an existing SBA loan holder, there’s good news!

  • The SBA will automatically pay the principal, interest, and fees of current 7(a), 504, and microloans for a period of six months.
  • The SBA will also automatically pay the principal, interest, and fees of new 7(a), 504, and microloans issued prior to September 27, 2020.

If you’re not sure what type of loan you have or if you would qualify for the deferment on the loan, call your loan servicing officer directly.

SBA Express Bridge Loans

This program enables small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly.

If a small business has an urgent need for cash while waiting for decision and disbursement on an Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.


  • Up to $25,000
  • Fast turnaround
  • Will be repaid in full or in part by proceeds from the EIDL loan

Local Relief Options

Different states are offering a variety of local relief options as well. Visit this site for a complete list of all covid financial assistance available on a state by state basis:

As a small, Ohio-based company, Wakefield is here to help. We treat our customers like family and if we can help you navigate through this unprecedented time, we will. We would be more than happy to lend a hand to our manufacturing family in any way that we can.

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