Deferment is no longer required for non-disaster SBA loans. Instead, the CARES Act will provide immediate relief to small businesses with non-disaster SBA loans, in particular 7(a), 504, and microloans. Under it, SBA will pay all loan payments on or after March 27, 2020 on these SBA loans, including principal, interest, and fees, for six months. This relief will ALSO be available to new borrowers who take out loans within six months of the President signing the bill into law.
- SBA will pay this first loan payment to the Lenders within 30 days of the first loan payment due date after March 27, 2020.
- If a borrower has already made a loan payment after March 27, 2020, inform the Borrower that it has the option of the bank either returning the loan payment to the Borrower or applying the loan payment to further reduce the loan balance after application of SBA’s payment.
- Many of our borrowers have their payments on auto-debit. These should be discontinued during this time period. At the end of the 6 months, all efforts should be made to put borrowers on auto-debit going forward.
Many Lenders may have already reached out to borrowers about this relief. If not, call your lender and make him or her aware of the relief under the cares act and if they don’t answer, send them an email so you have it in writing. All lenders are extremely busy at this time and doing their best to get back to their borrowers.