U.S. SBA Michigan district office leaders Laketa Henderson, deputy district director, and Romualdo Ancog, district manager discuss the Federal Disaster Loan Assistance available to businesses. Henderson and Ancog engaged in a discussion with the Chamber's Brad Williams.
U.S. SBA Michigan district office leaders Laketa Henderson, deputy district director, and Romualdo Ancog, district manager discuss the Federal Disaster Loan Assistance available to businesses. Henderson and Ancog engaged in a discussion with the Chamber's Brad Williams.
Hello. Uh, welcome everyone. Um, this is Devin O'Reilly with the Detroit regional chamber. Um, we had a little audio glitch. Um, we're working on, we'll get Brad back on to host a call soon. Mmm. But we have, uh, with us Romi um, from the SBA. Romy, are you there?
Speaker 2:I am. Can you hear me?
Speaker 1:Yes, I can, I can hear you. Well, we were just talking, we were talking to Brad all the way up into it and we, we lost him, so, um, we'll get Brad back on, but um, we can go ahead and get the call started.
Speaker 2:Great.
Speaker 1:Um, so first off, kind of to set the stage, let's talk a little bit about, um, kind of[inaudible] your role with the SBA and really kind of what's top of mind for everybody right now and kind of what, um, what all is being done, um, in the time being for, for handling this crisis.
Speaker 2:Thanks Devin. And thank you to Fred and Cindy for inviting SBA to be part of this webinar. Um, yeah, we talked about my role, my, my, my title is actually export finance manager. So I'm, I'm normally dealing with international trade issues for the SBA. I've been asked to help with this because my, my lending background, um, and it's got, and honestly it's all hands on deck. We're pulling all of our resources at GSB, you know, together, um, Marshall, him trying to help the small businesses that have been, uh, so severely affected by this crisis. Let me jump into it. Um, what we have been talking a lot about with all the small businesses, is that right? Economic injury, disaster loans. Okay. These have been well publicized, uh, you know, in the media. I'm here to talk about some of the specifics of it, how to apply, how to take advantage of this really, um, no really strong loan program to see, to help small businesses. So this is, no, we have a disaster declaration, you know, for Michigan that covers, uh, this loan. These are loans made available to small businesses that have been affected by the Copa 19. Mmm. And that the loan is to be used for paying your normal bills. So no, making payroll, making your loan payments to your bank, your insurance, your all right, even to pay your suppliers so you can, you know, uh, you know, pay your accounts payable with these also. So all the normal day to day, week to week bills that you'd detained that you can't because this crisis has occurred. Uh, that's what this alone is really there for. Most small businesses are, you know, um, really any small business in Michigan and nonprofits, nonprofits are included in this, uh, um, in this disaster coverage. So, okay, this is, the nonprofits are able to take advantage of this. That's 98% of the businesses in Michigan. There's only a few exceptions, you know, things like casinos and things like churches. Well, for the most part, uh, you know, you have to be a small business. Mmm. Yeah. We're encouraging any small business that thinks that they can take advantage to apply for it. Let me get into some of the terms of this. The loan scope up to$2 million, uh, depending, you know, it depends on what you're, Mmm. It depends on the size of your business. What they're doing right now is essentially they're taking your last year's tax insurance, looking at the Salesforce and dividing that in half. And that's the loan amount that they're looking to give out to small businesses. So let's call that six months worth of cashflow, you know, in order to help you get through this crisis. Uh, I talked about some things that can be used for, it's going to be, these are being approved at the low[inaudible] fixed interest rate, 3.75, uh, for businesses 2.75 for a, for a nonprofits if there's any underlying also. Okay. They're being approved at the stature limit of 30 years. So these are inexpensive, um, loans with low payments because the put note, they're giving me them such a long, um, along the amortization term. Yeah. They are also building into this automatically a 12 month Jeff deferral on payments. So you don't, so you get this loan, you can make your payments on it for your bills. You don't have to make it and it's on this for the first year. So we're real excited about the, um, the help, the relief that the Springs, uh, to everybody. And we're trying to, you know, trying to educate us on how to get into it. So[inaudible] you can access this loan by going to our website[inaudible] dot gov there's a longer string that, but I don't want to give that to you. If you just go to our main website, you can access everything for SBA and right on the front page of the SBA website is Mmm. There's a link to these disaster loans. Okay. Oh, economics injury, disaster loans. He IDLs you might see that abbreviation. Previously we've been encouraging everybody to apply electronically. Mmm. The website has been overwhelmed. Know, yes. You know, uh, the, the response has been so large to this, uh, the, the, the tra, they've taken the website down. They've, they had some workarounds right now. All right. So the electronic online application isn't available at the moment, but the site is up. You can get into edge, you can fill out the forms electronically and you can drag and drop them into a design set. There's a box that you can drag and drop the forms once they're filled out[inaudible] uh, and upload your documents all to that site. So it's a little bit different or math than what we had earlier in the week. But fortunately they've made some work around. You can get into the system, you get all the information you need about it. You can access the forums if fillable forms, fillable PDF and then make your application loans are being approved. Uh, the, uh, four to five business days, uh, and are being funded though they hope to have them funded within 30 days. So there's, so if you're familiar with[inaudible] lending on, especially government BEC lending, this is, this is pretty fast in terms of, uh, uh, of being ever access to this money. We do have some help available to help you fill out these forms. Uh, the, our partners at the small business development center and at score are available to help you. Again, you can find them on our website if you look for them. Mmm. Um, I'm encouraging a lot of people to talk to your bank, talk to your commercial bank. I've been on the phone with most of the banks around town and they're all helping their clients fill out these forms. So, you know, don't be afraid to use them as a resource also. Yeah. The other thing I want to say is, well, just, there's just one more thing is that if you have existing loans and existing SBA loan, we're encouraging our lenders to make deferrals on these loans. So talk to them, talk to them about your existing lending. Uh, they have the, uh, the authority to make those, uh, make those decisions on their own, on their own. They don't have to come to the spa. So they may be able to be able to, to provide immediate relief for your cashflow by deferring the loan, your loan payments. Less than I want. Just want to say, keep, um, keep watching the news because, uh, this, um, okay. Additional very large enhancements that we're expect to be hitting, uh, coming to the SBA. I can't talk about details about those. Yep. Frankly, except I don't know them. I'm things everybody else are, I don't want to talk and I'll speculate as to exactly what they're going to be, but, but Melissa that they do look to be, you know, substantial. So keep your eyes open for additional things coming up also.
Speaker 1:Great. Great. I mean that's, it's a lot of really good information. Um, just, just following up, um, you know, looking at kind of the stimulus pack package on the table, do you know, I mean, do you know anything more about, um, you know, any new loan programs, you know, you heard something about owns that may turn into grants. Um, do you know anything about that yet or is that still something that, um, you know, you're, you're looking for additional information?
Speaker 2:There is a lot of topics. Okay. You know, increasing our loan limits, creating a whole new release grant, a relief loan. Um, you know, similar to this disaster loan, but put put forth through the banks. Uh, there's, there's talk about, uh, a small business grained, so it would be administered through the SBA. Is that something I've never seen before? Again though? Um, I don't want to get too detailed on those. Mmm. Because I just don't know. I just don't know that yet. No. Um, I don't know anything more, probably then, you know, you're informed. Um, no, you're informed members also.
Speaker 1:Sure, sure. Um, so one of the things I was hearing from you is, you know, the are experiencing some issues with the website just because of the extreme volume. Um, but you are encouraging people to apply to kind of fill out those fillable PDF. So it's something that you can work on even if there is, um, some issues accessing the website directly. Um, it's something you can still, you can still work on filling out the information for those loans. Is that correct?
Speaker 2:That's absolutely correct. The West side is back up. Both the whey you apply for now has changed a little bit. You can't, you can't make the online application that was available early in the week. So you can't fill out the forms online and just hit submit, you know, um, no the way that we're kind of used to, but you can fill out the forms and then, um, and there's way email or drag and drop them to a portal on the, uh, on the page. So it's a little bit of a different format. You can still make it[inaudible] application though. That's the point I want to make. Absolutely. Get on the site. Um, you know, find the information you need. You can email us with questions at Michigan, at sba.gov or go to some of our other partners. Um, and hopefully we can get your questions answered, get you a plan dish into the queue.
Speaker 1:Great. Um, can you talk a little bit about, uh, some of the best practices that you're seeing small businesses, uh, take into consideration when, when handling this crisis and what are some of the, um, kind of other resources that small businesses can access?
Speaker 2:You know, I don't know. I'm the best person to talk about, you know, um, you know, Mmm. Best practices. You know what, I'm talking to a lot businesses right now. Um, everybody's, you know, taking the, the weight and trying to conserve cash where possible. I'm hearing about a lot of different programs that are out there beyond SBA. Okay. MADC is rolling out a grant programs, so that would be state wide, small business grains. All right. Yeah, I've been on the, uh, on, on panels with, uh, with MBDC, so that's rolling out. Wayne County, he has a small business grant in some loans, so does Oakland County. Uh, so this tech town, they have a small$10,000 a business stabilization grant. Pride organizations are signed to put forth some things out there. And I'm, Mmm. My, uh, my colleagues back in the district office trying to put together[inaudible] kind of a, a, you know, a list of all these resources, you know, and how to get in touch with them because they're coming through on a daily, you know, sometimes a, a number of them a day are coming in. So there's a lot of different resources that the SBA has. One of the largest, I think it's[inaudible] a really good program. But you know, I think there's other things coming online also.
Speaker 1:Sure, absolutely. And I mean I'll, I'll take the opportunity to plug, you know, Detroit chamber.com backslash COBIT 19. Um, we've also aggregated a lot of the resources that are available for small businesses. Some of the things that you mentioned, the, the tech town, um, small business stabilization fund. Um, also what the SBA is offering and then, um, a lot of different options. So I think, yeah, we're, we're, we're in lockstep and trying to both kind of find those resources and put them in a place that are easily accessible for, uh, for small businesses. Um, I'm going to take the time to take the opportunity now to kind of pass this along to Brad Williams who I think is back on now and um, has some questions from the audience.
Speaker 3:Hi, I am Devin and I apologize, I got kicked off the webinar right as I was supposed to start and I was supposed to be playing your role today, so I apologize to everyone for the late start. That was a, and I think that was my internet service providers fall. Let's blame it on them. So, uh, thanks for, uh, stepping in for me, Devon. Um, for those of you who have not, uh, submitted questions already and would like to, uh, you can do that in the chat room on your GoTo webinar, uh, software and what questions we can't get to today. Uh, on the, uh, on the tele town hall, uh, my team, uh, the government relations team at the chamber, uh, we'll be following up, uh, on the back end, uh, and getting to as many of these as possible. Um, there's been a couple of questions roaming about, um, uh, uh, people who, uh, either, uh, you know, started their business, uh, you know, after, uh, uh,[inaudible] or new businesses and so maybe don't have a, uh, a tax return for, uh, 2019 or 2018. Um, and, uh, or haven't filed their 20, 19 taxes yet. Can they use their 2018 return?
Speaker 2:Yeah, absolutely. It's what their 2019 returns aren't do yet. So, so we certainly can't ask for them. So, you know, submit your most recent tax returns for existing businesses. If you are a newer business, um, you are still eligible to apply. You can, you know, in lieu outfit of tax returns, you can uh, put forth just whatever interim statements you have or even projections for what you, you know, what you may have been generating this year so that they will accept that. Did you have to open a business? I talked to a gentleman yesterday who would say, you know, I was about to launch and now I can't that he's that in business yet. You know, businesses like that are not L a are not eligible.
Speaker 3:Um, there's a question too. Uh, it says, just to clarify, the businesses apply for the disaster relief loan directly. You mentioned that bankers are helping customers fill out the form, but is it required that business owners apply directly with the SBA? So, so do you apply through your bank or do you apply directly with the SBA and get your banker to help? What's the best way to go about this?
Speaker 2:That's a great question. Because SBA loans, most SBA loans are through the banks. So the banks originate them and we guarantee that's not this kind of loan. This is a direct loan from the SBA. Sure. Clear that from the beginning it's a direct loan from the[inaudible] work disaster loan area. So you're making application directly with us and the money comes directly from the SBA. It doesn't come from a bank.[inaudible] the point I was trying to make is that the bankers are there as a resource to help you fill out the forms. Okay. And uh, I can't say every bank's doing that, but a lot of bankers I've talked to[inaudible] I've been helping their clients. So just throwing it out there as another resource.
Speaker 3:[inaudible] um, how do, how do businesses check on the status of their application if they've, uh, if they've applied for a loan under this program, how can they check on, on, on what their status is?
Speaker 2:Right now that's a little bit hard. Uh, when the, no under normal circumstances, the website ha has, uh, electronically a check status, no check application status part of it. Uh, so you get a loan so you get all your information, you get a loan number and you, you'd able to go back into the system and check that. Right now we don't have that function, uh, functionality, so I'm sorry. We do know that, that you can't check to see where it is. Mmm. Hopefully that will come back soon. I know that they're trying to make those enhancements on their website, bring all of those, that functionality functionality back up, but at the moment we don't have a way to check on that.
Speaker 3:And do these loans require a personal guarantee, uh, by the owners do so do they require collateral? Uh, as is traditional[inaudible]
Speaker 2:yeah, they do. Uh, so, um, loans, um, if you're a smaller loan, less than$25,000, they, uh, you know, they can do those unsecured or without any collateral, anything above$25,000, they're going to look to see what available collateral there is. As a matter of policy at SBA, we will not decline a loan just for a collateral shortfall. Okay. And that goes for what our normal business loans also. So would these loans still look to see what assets are available in the business and personally if there isn't assets there, you know, or SSI? No, that's still have some value, you know, um, SBA will still approve the loan even over a collateral shortfall provided everything that's available has been pledged.
Speaker 3:Yeah.
Speaker 2:Is that okay? Did I explain that well?
Speaker 3:Yeah. Yeah. And I know you can't, um, speak necessarily to, you know, what potentially could be coming from Congress. Hopefully. Hopefully today we're all keeping our fingers crossed. But there's, there's a question in the chat room that I think, you know, even if we can't answer today, uh, maybe we can provide some clarity on later, but, um, you know, there's, you know, should, uh, do you think businesses should begin the application through the current E IDL format? Or do we think that the core application process will be different? Uh, once the cares act passes, again, fingers crossed today. So, I guess the question is, do you anticipate that, that fundamentally the, the process will change? Uh, if Congress passes the legislation, they're, they're, they're contemplating today.
Speaker 2:There will, so, so let me talk to[inaudible] about this a little bit. The new care act loans are supposed to have some really, uh, interesting bells and whistles on, for example, um, I didn't to get into says, but for example, there's a portion of it that talking about that might be forgivable. The portion of the loan that's used to pay payroll. All right? So if you're keeping all your employees on staff and you're paying them, that portion of the loan might be forgivable. So, uh, I've talked to them. Business owners would say, well, I might wait for that rather than applying for this, uh, um, Ida loan. What we're suggesting is do both, you know, apply for this loan now because it's available. Get into the queue. There's no obligation to take the money, you know, so, you know, and even if you do take the money, you know, you can pay it back without any penalty. So there's no harm in taking this. If no, the other loan though, if another loan gets approved and it has features that you think are more attractive, you can apply for that and SBA will coordinate, you know, um, alone, you know, what, we'll coordinate how much is appropriate. So we won't, you know, you could fill a pipe for both and maybe they bounce a loan or maybe they shipped the loan over to the other program. But you can, you know, you, you, you can't double up the money per se, but, uh, and I just heard this yesterday from the disaster loan people, um, on a, on a training with them. So this is being anticipated that, um, some businesses may want one or the other. We're encouraging people apply. Now we can balance it. Uh, you know, if another program comes out or you could just cancel the idle loan in a platform for the, uh, the second program that's coming out.
Speaker 3:Okay. There's quite a few questions again about, uh, the website and the technology. Um, and the 800 number, I mean, can you, can you update people again? I know, um, you know, not just the SBA, but a lot of, uh, government agencies that are dealing with this crisis are having technology overload. But what are you seeing, you know, as far as your technology and, and, and, and what should people do who are struggling to get through to SBA, be it, uh, you know, through the website or through 800 numbers. Um, do you have advice for them?
Speaker 2:Uh, we, you know, um, locally we've also, we've become pretty, um, expert, I shouldn't say expert, but pretty familiar with a lot of these, um, a lot of the questions in the application in the last week or so. I knew nothing about this, you know, seven days ago. Now I know far more than I probably ever want to know. So locally we've got some expertise. We might go to answer some of your technical question or some of the application issues. No, we can't, you know, um, push them through any, uh, any faster. It give you a status, but if you want to contact us at the, at the district office, Mmm. Maybe we can answer some of your questions and help, um, help you. Yup. Drew. So the application process
Speaker 3:[inaudible]. Okay. All right. Well, I'm, I know, um, there, there, there's a lot of questions too about the cares act. And you know, as we've already talked to this is, this is such a new and breaking news. Um, just know for the members who are on the phone that we already have on the chamber website, uh, at betray chamber.com/cobin 19, uh, we have, uh, an update on the content of the cares act, uh, from the U S chamber as it passed the Senate last night, which we assume, uh, will be, uh, the same version, uh, that it passes the house. Uh, and so it goes into great detail so you can get some information there. Um, and as we get some, uh, some substance as, as how it's going to apply, uh, in the SBA and the rest of the government, we will, uh, be setting up more of these, uh, tele town halls, uh, that will be helpful to you. I know we have, uh, a call coming up. Uh, next week with, uh, Congresswoman Haley Stevens, we're working to set up one, uh, with Congressman Fred Upton as well too. So, so know that, uh, we're trying to get, uh, as much in more information, uh, as we possibly can on this. Uh, so, uh, so, so, so thank you for your patience on this and we will try to get to more of your questions. Uh, with that, Devin, I will hand it back to you, uh, to, uh, to wrap this up for today cause I know we're coming up against our half hour time limit.
Speaker 1:Sure. Um, thanks Brad. So much for, for handling that and thanks for me for participating in this. Um, it was great. Uh, we had a lot of questions as we mentioned earlier. Uh, this, this will be recorded. Um, so will this, this whole conversation, this tele town hall is recorded and will be available to, to share and to listen again. So I know there were some questions about individuals who, why don't I share this with someone who didn't get a chance to jump on or someone who may have jumped on late. Uh, we will definitely, uh, we'll definitely make this available again to Trek, chamber.com backslash COBIT 19. Um, there's also some questions that we weren't able to get to. Um, some more specific maybe individual-based questions. Uh, we're gonna follow up and we're going to make sure that we get as many of these questions answered as possible, uh, for those who are on the, the town hall today. Um, so if we didn't get your question answered today, we will, uh, we'll, we'll look to follow up with you and make sure that you have all the information you need. Um, Romy, again, thanks for thanks being a part of this.
Speaker 2:Absolutely. Let us know if we can help with anything else. Happy to share more information as we get it about the cares act.
Speaker 1:Absolutely. Um, do you want to give that website one more time?
Speaker 2:Uh, our main website is[inaudible] sba.gov you can find local resources as well as get into the disaster application from there.
Speaker 1:All right, perfect. Well, thanks. Thanks so much. And thank you everyone for joining today.