Today I want to share what seems to be a forgotten goody in the Cares Act for business owners and entrepreneurs.
If you are funded for a new SBA loan between now and September 15th, your first six months of principal and interest will be entirely forgiven. On a year SBA note, this is like receiving a five percent discount.
What are some possible use cases?
Perhaps you have some shorter-term debt that you would like to refinance. In this case, you will improve your cash flow by reducing your monthly payments and receive the discount.
If you have an acquisition in mind and can get the deal done in time, you can effectively get a five percent discount on the amount that you finance.
Is there a partner that you finally want to shake and bid farewell? SBA loans are an excellent tool to buy out a partner.
Or perhaps you visualize growth on the horizon and want to bolster your balance sheet with some cash to fund it. SBA loans can help in this area as well.
Whatever your plans might be, the SBA has historically been an essential tool in any economic recovery, and there is no reason to believe that the program won't be a vital part of this recovery.