This case study shows how a real estate business in Texas, that was impacted by the coronavirus/COVID-19 pandemic and mandated shelter-in-place, was able to get a Paycheck Protection Program (PPP) loan through Fundbox to help their small business. As of December 27, 2020, Congress has approved additional funds for the PPP. The SBA can help you find a lender.
Company:
Donald Leonard is employed by multiple real estate businesses, including Texas Star Realty Professionals, which he owns with his wife Carol, and Champions School of Real Estate, where he’s an independent contractor. With the coronavirus spreading quickly, by late March, 2020 the Texas state government mandated shelter-in-place. This meant he couldn’t work.
Challenge:
With no clear timeline as to when the economy would reopen, he started looking at his options. Through his realtor association he heard about the CARES Act and the new Paycheck Protection Program (PPP), which aims to support small businesses with employees and independent contractors and sole proprietors like him. He was excited at the possibility of relief funds to help pay the bills while he waited for the state government to lift the quarantine regulations. However, soon after the government released the guidelines for applying as a sole proprietor on April 10 the first round of funding ran out.
Solution:
Around the time the second round of funding was announced, Donald received an email from Fundbox, offering information in order to help him apply for PPP funds. He had an open line of credit with Fundbox so he was familiar with the service. He clicked to apply and filled out some basic details. Then Fundbox connected him with partner Cross River Bank to submit the application to the SBA. “The entire process was really easy,” he said. “To be honest, I thought it was going to be a lot worse.”
Within a few days, he had heard back from Cross River and was approved. He signed the loan documents and a day or two after that the money arrived.
Results:
“I’m going to use at least 75% of the money mostly for payroll, to pay myself. With the rest I’ll pay utilities and my share of the office rent.” Concerned about qualifying for forgiveness, he hired ADP to run payroll for him. “I opened the ADP account so I can clearly keep track of exactly how much I’m paying myself each pay period.”
Disclaimer: Eligibility for PPP loans may vary based on your specific business, and the lender you apply with. Fundbox does not provide financial, legal or accounting advice, and this content is not intended to provide (and should not be relied on for) financial, legal or accounting advice. You should consult your own PPP lender or your own financial, legal or accounting advisors before engaging in any transaction.
