Main Street Lending Highlights
The Federal Reserve is currently seeking feedback through April 16 on the Main Street Lending Program for companies:
- with up to 10,000 employees OR
- less than $2.5 billion
- created in the U.S.
- 4-year loan
- Principal and interest payments deferred for one year
- Prepayment permitted without penalty
- take out the minimum loan size of $1 million and no more than $25 million
- make reasonable efforts to maintain payroll and retain workers
- don’t use the funds to pay off other debt
- put payments into the highest priority for repayment
- don’t reduce lines of credit
- attest the funds are needed due to COVID-19
This list is not complete. Please discuss details with your lender.
How it Adds to the SBA Loans
The Main Street Loan can be issued by a lender:
- as a new loan
- can be used to increase the size of existing loans
- can be in addition to the PPP (payroll protection program)
Financial institutions retain 5% share, selling 95% to the Main Street facility, which will purchase up to $600 billion of loans.
- Sets up a lending program for state and local governments NOTE: no community in our area qualifies due to it being for cities with populations of 1 million and counties with populations of 2 million
- Expands funding of student, auto and credit card loans to include commercial mortgages and other business loans.
- Increases the amount of funding for corporate bonds and broadens the support for companies whose credit ratings have been downgraded due to the crisis.
Post expires at 9:36am on Saturday April 25th, 2020