Small Business Resources

You may qualify for a second round of PPP Loan funding if you meet the following requirements:

- Have no more than 300 employees
- Have used or will use the full amount of your first PPP loan
- Can show a drop of at least 25% in annual gross receipts or for any quarter of 2020, compared with the same quarter in 2019
- Have not permanently closed. Businesses that have temporarily closed or suspended operations can receive a second-draw loan.

Second-draw PPP loans are available to businesses, certain nonprofits, self-employed individuals, independent contractors, sole proprietors, housing cooperatives, small agricultural cooperatives, veterans' organizations and tribal businesses.

(lending provided by Lendio)

How much you can receive.

The formula for second-draw PPP loans is similar to that of initial loans: Borrowers can receive up to 2.5 times their average monthly payroll costs. Average monthly payroll costs can be calculated using one of the following:

- The 12 months prior to the loans.
- Calendar year 2019.
- Calendar year 2020.

Seasonal businesses (typically operating for less than seven months in a calendar year) and new businesses in operation on Feb. 15, 2020, but not open for a full 12 months, will use a separate formula to calculate average monthly payroll.  

- Seasonal businesses: Average total monthly payroll for any 12-week period between Feb 15, 2019 and Feb 15, 2020.

- New businesses: Total payroll costs divided by the number of months those costs were paid out.

Hotels, restaurants, and other accomodation and food service businesses can borrow up to 3.5 times their average monthly payroll costs. 

Unlike initial loans, the maximum amount for second-draw PPP loans is $2 million. First-time PPP loans max out at $10 million. 

How the money can be used.

Second-draw funds are forgivable, provided they are spent on covered costs, including:

- Payroll costs, including paid sick leave and group insurance benefits provided by the employer.

- Operating costs, including payments for mortgage, rent utilities, software, and human resources and accounting needs.

- Property damage sustained during protests and disturbances in 2020, unless covered by insurance.

- Payments to a supplier covering contracts and purchase orders in effect before taking out the second-draw loan.

- Personal protective equipment and modification made to meet health and safety requirements. 

At least 60% of the total loan amount must be used on payroll expenses to qualify for full loan forgiveness.

North East Texas Credit Union is not a SBA lender at this time, but we still want to provide you with resources that can assist you during this difficult time.  Please use the links below to find the latest information regarding small business guidance and support available through a multitude of organizations.  As always, please contact us with any questions or concerns.

Small Business Administration


SBA Express Bridge Loans


SBA Debt Relief

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