Times have been tough for restaurants and cafes. The pandemic has had a devastating impact on many businesses in this industry. With government-imposed shutdowns and social distancing guidelines in place, many have had to either close their doors permanently or fight to survive. The good news is, that there’s hope for these struggling businesses in the form of the CEBA loan. This is a federal loan program that is being provided through local banks and credit unions. It’s worth looking into if you’re looking to keep your restaurant or cafe afloat.
The CEBA loan is available to help businesses that have a payroll of $20,000 to $1.5 million. The program is provided through local banks and credit unions, and the loan can be used to cover non-deferrable expenses such as rent, utilities, and insurance. The loan has a $40,000 upper limit, which may be extended depending on your bank or credit union. You can apply for the loan now, even if you aren’t yet sure whether you will be eligible.
One of the benefits of the CEBA loan is that it is interest-free until December 31, 2022. After that, the interest rate will be limited to only 5%. Even better, the CEBA loan can be forgiven if you pay it back by December 31, 2022. This forgiveness is designed to help keep businesses afloat during the pandemic. If you don’t pay back the loan by the deadline, it will convert to a 3-year term at an interest rate of 5%.
If you’ve already received a CEBA loan, you may be wondering what your repayment options are. CEBA loans are interest-free until December 31, 2022, which means that there’s no interest to worry about in the short term. After that date, interest will be applied to any unpaid balances. If you have not yet paid the loan back in full by that date, you can choose to refinance the loan under the CEBA Loan Refinancing program.
The CEBA Loan Refinancing program allows you to extend your loan term for up to 10 years. Also, you’ll be able to receive an interest rate of only 5%. To be eligible for the loan refinancing program, you will need to have received a CEBA loan before December 31, 2020, and still have a balance remaining on your loan. You will also need to provide documentation to prove that you meet the eligibility criteria.
Conclusion:
In conclusion, the CEBA loan program is a great option for restaurants and cafes that are struggling during the pandemic. This loan has an upper limit of $40,000 and is interest-free until December 31, 2022. The loan can be used to cover non-deferrable expenses such as rent, utilities, and insurance. If you pay back the loan by December 31, 2022, it can be forgiven. If you have already taken out a CEBA loan, you have the option of refinancing it under the CEBA Loan Refinancing program. This program allows you to extend your loan term for up to 10 years, and you’ll be able to receive an interest rate of only 5%. So, if you’re running a restaurant or cafe, and you’re not sure how to make ends meet, a CEBA loan could be your answer from uncertainty to empowerment.