Good news for small business owners and nonprofits, New York now allows eligible borrowers who received PPP loans and EIDL to also avail a NYFL loan, effective immediately until funding runs out.
The New York Forward Loan Fund (NYFLF) is the economic recovery loan program launched last May to support New York small businesses, nonprofits and small residential landlords as they reopen after the COVID-19 outbreak and NYS on PAUSE.
Changes in the program are aligned to the States’ effort to expand eligibility of NYFLF after discussions with lenders and applicants deem PPP and EIDL insufficient to support local-based businesses.
Who Is Eligible For NY Forward Loan Fund?
- Small businesses and nonprofits that got a Paycheck Protection Program (PPP) loan not greater than $500,000 or Economic Injury Disaster Loan (EIDL) loans not greater than $150,000 can be eligible for a NYFLF loan;
- Must have full-time equivalent (FTE) employees not greater 50;
- Must have gross revenues of less than $5 million per year;
- Must have suffered a direct economic hardship due to COVID-19 restrictions and policies that have materially affected business operations;
- Must be in business for at least 1 year during the date of the application; and
- Must be located in the State of New York.
What Are The NYFLYF Loan Terms?
Loan Amount
- Small Business: Small businesses can get a loan amount less than (a) $100,000 or (b) up to 100% of average monthly revenues in any 3-month period from 2019 or first quarter of 2020.
- Nonprofits: Nonprofits can get a loan amount less than (a) $100,000 or (b) up to 100% of average monthly expenses in any 3-month period from 2019 or first quarter of 2020.
- Small Residential Landlords: Landlords can apply for a loan less than (a) $100,000 or (b) projected reduction in 6-months’ net operating income based on actual reductions in net operating income for the month of April or May 2020.
Interest Rate
- Small businesses and residential landlords: 3% fixed annual interest rate.
- Nonprofits: 2% fixed annual interest rate.
Repayment
- For months 1 – 12: Interest only payments, paid monthly.
- For months 13 – 60: Interest and principal payments, paid monthly.
Term of loan
- 5 years (60 months).
Proceeds
- Loan funds should be utilized for working capital, inventory, marketing, refitting for new social distancing regulations, maintenance for operation and emergency, property taxes, utilities, rent, supplies, etc.
- Refinancing of an existing loan is not allowed.
- Loan applicants must detail anticipated use of loan proceeds when they apply.
Borrower Fees
- No application fees. Late fee will be reviewed for missed payments.
Recourse
- No specific collateral is required to be eligible. Take note that NYFLF program requires a blanket first or second lien on business assets will be filed by the community lender and any owners with more than 20% ownership must sign a personal guarantee.
Prepayment
- You may prepay the loan without penalty
If you previously applied for NYFLF but got denied because of your EIDL or PPP loan, you may reapply to avail the program.
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