New York Forward

June 20, 2020

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New York Forward Loan Fund Application:

New York Forward Loan Fund is a new disaster relief fund that is designed to help New York State small businesses, NY nonprofits, and landlords across the state as we begin to reopen in the face of the covid-19 pandemic. Given the unprecedented demand for economic relief in the midst of a recession, this new NY business loan is designed to help bridge a small, but significant, gap by providing assistance to local organizations. In this video, I cover the New York Forward Loan Fund in detail, including eligibility requirements, potential loan amount, and when to apply. Ideally, you will be able to use these new small business resources to remain afloat (or better yet prosper) during these times. If you have additional questions regarding the New York Forward disaster relief fund or if your business is looking for any real estate advice (or you are personally), please feel free to ask.

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Hey everyone, I hope you are having an excellent, wonderful day. Today we are talking about a new program for our New York small businesses, nonprofits and landlords, so let’s get started. Hey, if this is your first time to the channel, thank you so much for joining us. My name is Justin Simmons with DKC Realty Group and I’m a licensed real estate salesperson in New York state and Connecticut. Since this is your first time here, please make sure to click that subscribe button below and hit the bell right next to it so you can get up to date notifications when we have new videos uploaded. Now, the program we’re talking about today is the New York Forward Loan Fund and I challenge you to say that five times fast. It is an economic recovery loan program assisting small businesses, small nonprofits and small landlords across New York state as we reopen. The funding for this loan program is specifically designed for small businesses, small nonprofits and small landlords that were impacted by COVID-19, social distancing guidelines and/or stay at home orders. Eligibility for this loan program will vary depending on the category you fall under, however there are some common guidelines. First, you have to be located in New York state. Second, you cannot have received a loan from SBA’s paycheck protection program, nor the economic injury disaster loan program from SBA. So you can’t have gotten any of that SBA money for COVID-19 in 2020. And the third thing is you have to have been in operation for at least one year at the time of your loan application. So let’s talk about additional eligibility criteria by category, so for small businesses you have to have less than 20 full time equivalent employees and you have to have had gross revenues of under $3,000,000 in a year. Nonprofits, you have to employ less than 20 full time equivalent employees. You have to be a registered 501c3 or faith-based organization. You have to provide direct services to New Yorkers. Think of day care or food banks, and you have to have an annual operating budget of less than $3,000,000. So for my landlords, our eligibility criteria is the most complicated, so let me just say that you have to have less than 200 units overall and you cannot have a property that has more than 50 units in it. Now there’s additional criteria that you wanna review. So the link to the program is in the description below, so you can go check all that criteria out. Now, if you like what you’re hearing so far, please remember to slam that like button for us. It’s great for engagement and views and you can subscribe to stay up to date on what’s happening with real estate in the area. So let’s talk about loan features. The loan is capped at $100,000, can’t be more than that. Okay, now we’ll talk a little bit later about how you can calculate your maximum loan amount, but just know that it’s not gonna be able to go more than $100,000, all right? Second thing to know with the loan features, there’s no collateral required, that’s a good thing. There are no application fees, another good thing. However, you can be charged for late payments if you receive the loan, so just be mindful of that. The length of the loan is five years or 60 months, and it’s paid back on a monthly basis. Now for the first year, you’re only making payments on the interest, so your loan amount, very small. Years two to five, you’ll be paying back the interest, plus the principal, so what you’re paying each month will go up, okay? However, there is no pre-payment penalty. So if you are able to pay extra at the time and save yourself interest, you can do that without a problem. Now, in terms of interest rates, for small businesses and landlords, we get a fixed annual interest rate of three percent. For nonprofits, it’s a fixed annual interest rate of two percent. Now, how do they determine your actual loan amount? That is gonna vary depending on the category, but let’s start with small businesses. For small businesses, your loan amount is gonna be based off your average monthly revenue for a consecutive three month period in either 2019 or from January 2020 to March 2020. So you can either do last year or the first three months of this year. To get a greater loan amount, you wanna pick the three consecutive months when you had the highest monthly average of revenues. So let’s give an example. If in October, you had $15,000 in revenue, in November you had $20,000, in December you had $25,000, the average of those three months would be $20,000. They will take the $20,000 and multiply it by three. Your maximum loan amount in that instance will be $60,000. Nonprofits, your loan amount’s also gonna be based off a three month period. It’s 100 percent of your average monthly expenses for any consecutive three month period in either 2019 or from January 2020 to March 2020, okay? Landlords, the way our loan amount is calculated is a little different and you might say a little more complicated. But let me explain. They’re basing our maximum loan amount off of projected reduction in three months net operating income, based off the actual reduction in net operating income that we received in either April 2020 or May 2020. Let’s say you own a four family, that’s your investment property. In April 2020, two of your tenants were unable to pay rent and two were still able to pay rent, all right? So let’s say the two that missed rent, you lost $3,000 in net operating income. However, in May 2020, unfortunately three of your tenants were unable to pay rent and now your loss of net operating income was $4,500. In that case, if you want a higher loan amount, you’re gonna use May 2020, that’s $4,500. They’ll multiply that by three. What does that give you? Quick math in my head, $13,000, $13,500? We’ll check. Now, of course if you have multiple units, multiple losses, you wanna check across all your units to see whether April or May gives you a higher amount if you wanna qualify for a higher maximum loan amount, okay? And if you got a quick second and you like what you’re hearing, slam that like button for me real quick, thank you so much. What can you use the money for? Well, you can use the proceeds for a number of things. It includes working capital, refitting for social distancing guidelines to make sure you can adhere to them, utilities, rent, supplies, maintenance, et cetera. There’s a lot of different categories that you can use the money for. However, you cannot use this money to pay off another loan, so it’s not like you can use it to refinance, so to speak. That’s not allowed. At the time you’re applying, they will ask you to give a breakdown of what you project to use the money for. So you do wanna have that list ready for you when you apply. Now, in terms of applications and applying, New York is telling us that applications are being reviewed on a rolling basis as industries and regions reopen across the state. So if your industry in your area has already reopened, apply now, okay? You’re being given priority and there’s a limited amount of money in the fund. If your industry and/or region has yet to reopen, apply now with the pre-application, right, because demand is very high, so you wanna make sure that you’re one of the first people in there when they do start considering applications for your industry in your area. Since we got so many entrepreneurial folks here, if you like this video, I’ve got another one popping up that I think you’ll really enjoy, just giving you the basics in real estate investing. So if you’re looking to expand into that, you can definitely check out that video. And of course, if you’re new to the channel, subscribe so you can stay up to date.