For those who missed our call this week, or who wanted the links that Kristian referred to about the loans, here is the update!
CARES Act Funding
As of April 16th, the SBA has stopped accepting new applications for the Paycheck Protection Program & Economic Injury Disaster Loans due to a lapse in funding. Please know that Congressional leaders are presently in negotiations to appropriate additional funding to the tune of $250 billion, after which, the programs should begin accepting applications again. It is unclear when the legislative logjam will break.
On Monday, NAR sent a letter strongly urging Congress to provide additional funding for the PPP and EIDL programs in future COVID-19 response legislation, ensuring the need for these loans is met as this crisis continues. In addition, Congress should clarify implementation to resolve issues with added limits and requirements that are not in accord with legislative intent.
EIDL Changes
This week, the SBA announced a change to how it will administer EIDLs and the advance grants. In order to meet the high demand and provide funds to the greatest number of applicants, the SBA is now conditioning advance grant amounts on employee numbers – $1,000 per employee, capped at $10,000. In addition, some SBA loan counselors have advised applicants that the EIDL is being capped at $15,000 per business, bringing the total maximum amount to $25,000.
While NAR understands the SBA’s goals in reducing the loan and grant amounts, we are concerned that this dramatic change in the implementation of the programs will reduce their usefulness for many small businesses and disproportionately impact independent contractors who do not have employees. NAR has expressed these concerns to Congress (see above) and urged them to provide additional funding to the SBA loan programs in future COVID-19 relief bills in order to ensure that the programs can provide adequate funding and assistance to businesses in need during the crisis.
Click Here for NAR’s Updated SBA Loan FAQ
PPP Changes
Also this week, the SBA released a new rule which clarified the forgivable portion of the PPP Loan. For independent contractors and sole proprietors without employees, PPP loan forgiveness is now limited to a proportionate eight-week share of the borrower’s 2019 net profit, which would be reflected in the individual’s 2019 Form 1040 Schedule C. Another words, if that individual wants 100% forgiveness for their PPP loan, they will need to limit their loan request to 8 times their average weekly net profit (rather than 2.5 times their average monthly net profit).
Though independent contractors and sole proprietors may still request a loan amount up to 2.5 times their average monthly profit as set forth in the CARES Act, loan proceeds above 8 times their average weekly income may not be forgivable and will be treated as a conventional loan which must be repaid.
Click Here for NAR’s Updated SBA Loan FAQ
Further Reading: Two Winning Paths to a PPP Loan from REALTOR® Magazine
IRS Launches Stimulus Check Tracking Portal: “Get My Payment”
The new IRS’ new “Get My Payment” tool allows taxpayers to check on the status of their stimulus payments and confirm whether the money is arriving via direct deposit or paper check. You can also enter new bank information if your direct deposit account isn’t on file.
NAR Calls for Servicing Relief as Banks Tighten Mortgages
More coverage here from REALTOR® Magazine
NAR sent a letter on March 27, to the Treasury Department, the Federal Reserve, and the Federal Housing Finance Agency (FHFA), to protect against negative impacts on primary market liquidity by requesting support for the mortgage servicing industry facing an extraordinary scope of forbearance requests.
NAR joined a coalition statement on April 4, directed at financial regulators advocating for a servicer liquidity facility to support homeowners and renters impacted by COVID-19 in light of the recently passed CARES Act.
NAR Quick Reference Guide on Health Insurance Coverage Now Available
This Guide provides a high level overview organized by source and type of coverage (Employer, Medicare, ACA for testing, treatment, etc.), including numerous helpful links to federal, state and other official sites for those interested in learning more.
According to NAR research, nearly two-thirds of NAR’s membership obtain their health coverage through a spouse’s employer-sponsored health plan, Medicare, or a health plan purchased in the Affordable Care Act’s “individual” market. Ten to fifteen percent, however, remain uninsured.
NAR recognizes that the COVID-19 national emergency presents additional challenges, particularly to members and their families’ health and well-being, as the Nation continues to weather the public health and economic storm. Congress and the Administration recently responded with a number of public policy changes to help bolster health insurance plans and ease requirements for more individuals to obtain treatment and insurance. Below, is a high-level summary of these changes, what COVID-19-related medical services may be covered, along with helpful links and resources on these benefits.
Click Here for NAR’s Quick Reference Guide on New Health Insurance Coverage
Members TeleHealth Deadline Extended until End of May
In the initial weeks of its introduction, more than 25,000 members and their families are receiving coverage through Members TeleHealthSM. Because of the tremendous response, NAR leaders have decided to extend the offer through May 31. The Leadership Team cited their strong feeling that REALTORS® and their families should have access to telemedicine at this time. Their message to members: “Stay home, stay safe. Nothing is more important than your health and welfare.” The offer is also open to association executives in need, but enrollment is limited. You can learn more here.
Help Share Right Tools, Right Now Benefits for NAR Members
Members should know about the about Right Tools, Right Now, a program to help members in this challenging climate. NAR is making a vast number of business-critical webinars, courses, toolkits, and other resources available for free or at discounted rates, including exclusive offers from DocuSign through April 30.
Podcast: REALTORS® Make A Stand On Capitol Hill – an Interview with Shannon McGahn
From The Brian Buffini Show: In times of crisis, it’s reassuring to know that you have good people in your corner. In a continuation of a series with the leadership of NAR, Brian interviews Shannon McGahn, Senior Vice President of Government Affairs for the National Association of REALTORS®. Brian and Shannon discuss how the organization is representing the interests of the real estate industry on Capitol Hill during the Coronavirus crisis. Topics discussed include how pandemic unemployment assistance can help those who need it; why cash flow is so important to real estate and how the pushback of the tax deadline to July 15 will help the industry; and how lending institutions can service small business with loans. Click here to listen!