CARES Act - Financial Assistance

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides relief to families, small businesses, and to individuals who are self-employed and independent contractors. Various relief programs may be available to real estate brokerages and agents.

Pandemic Unemployment Assistance

A key provision in the law creates a temporary "Pandemic Unemployment Assistance" program that extends unemployment benefits to those not traditionally eligible, including self-employed individuals.

The unemployment assistance may be available to individuals who are unemployed, partially unemployed, or unable to work for the weeks impacted as a result of COVID-19 between Jan. 27- Dec. 31, 2020.   


Disaster Loans and the Payroll Protection Plan

The CARES Act dramatically increased the role of the Small Business Administration (SBA) in efforts to assist U.S. businesses impacted by the COVID-19 crisis. There were two main vehicles for these relief efforts – Economic Injury Disaster Loans – and the SBA 7(a) Payroll Protection Plan loan program.

See below for details of each program.

Accepting New Applications for Economic Injury Disaster Loans and Advance (Updated 6/18)

Funding has resumed and the restriction that only agricultural business can apply has been removed.  Economic Injury Disaster Loans provide an advance of up to $10,000. This advance is designed to provide economic relief to businesses that are currently experiencing a temporary loss of revenue. This loan advance will not have to be repaid. Recipients do not have to be approved for a loan in order to receive the advance, but the amount of the loan advance will be deducted from total loan eligibility.  Applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis. 

Eligible small businesses and agricultural businesses may apply for the Loan Advance here.

Payroll Protection Program - SBA 7(a) (Updated 6/18)

The Paycheck Protection Program provides 100% federally guaranteed loans to small businesses that maintain their payroll during this emergency. Businesses with 500 employees or fewer, including sole proprietors and independent contractors, may be eligible for SBA 7(a) loans in response to COVID-19 covering expenses for the period of Feb. 15, 2020 through December 31, 2020. The CARES Act appropriates $349 billion to cover these loans. 

July 28: For brokerages that have applied for a Payroll Protection Program (PPP) loan or if you are considering applying, NAR has released a video with the new PPP guidelines.

July 22: There has been an extension of the PPP application deadline to Aug. 8, 2020. The program still has funding available as of July 22.

On June 17, SBA and the Treasury released updated forgiveness forms and guidance for PPP loans, based on the changes made by the "PPP Flexibility Act" signed into law on June 5. NAR's SBA FAQ has been updated to reflect these changes, which you can access here.

Notably, the updated forms clarify that the automatic forgiveness based on "owner-compensation replacement" is raised for borrowers who opt for the 24-week covered period from an 8-week amount (which still applies if borrowers choose the 8-week covered period) to an amount equal to 2.5x their average monthly net income. Thus, independent contractors who opt for the 24-week covered period are eligible to have their full PPP loan automatically forgiven under the new guidelines.  These borrowers must still complete and submit a forgiveness application to their lenders.  

In addition to updating the earlier forgiveness application form to reflect the lower 60% requirement for payroll expenses (down from 75%) and the extended 24-week covered period (borrowers who received their loans before June 5 can opt for either an 8- or 24-week period; borrowers who received them after must use 24-weeks), it also created a streamlined "EZ Forgiveness Application."

The EZ Forgiveness Application is for borrowers that:

  1. Are self-employed and have no employees; OR
  2. Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; OR
  3. Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.