Washington — The Association is waiting for clear guidance from the Small Business Administration on the best way to help dentists considering applying for Paycheck Protection Program 7(a) loans.
The agency was set to allow banks and other preferred lenders to begin dispensing these loans beginning April 3. However, as of late April 2, the guidelines for borrowers and lenders continues to change, according to ADA staff.
The new 7(a) loans were created as part of the Coronavirus Aid, Relief and Economic Security Act, the third legislative relief package in response to the COVID-19 pandemic that was signed into law March 27.
The new loans were intended help smaller employers keep their employees on the job or hire them back with their salaries and benefits at the same level as before the effects of virus changed their work situation.
Under the provisions in the CARES Act, employers can use the money from the 7(a) loan to pay for payroll and benefit expenses, as well as mortgage/rental payments or utility expenses. Additionally, some of the 7(a) loan dollars that are used for payroll expenses, benefits and nonpayroll expenses will be eligible for some loan forgiveness, according to the Small Business Administration.
The ADA will not be issuing any guidance until there is a clear understanding of the terms of the 7(a) program.
The ADA continues to recommend that dentists consult with their financial advisors to determine if this loan would be the best fit for their practice.
Visit ADA.org/virus for the latest COVID-19 information.