CARES Act — Preliminary Loan Application Checklist

By now, you are likely aware that Congress recently passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act (“CARES Act”) which, among other things, is intended to assist business owners with immediate cashflow needs. Among the programs established under the CARES Act is the Paycheck Protection Program. Prospective applicants should begin gathering the following information to be adequately prepared when the SBA’s rules are finalized and the CARES Act program is open for applications.

Maximum Loan Amount

The maximum loan amount (capped at $10 million) is the lesser of:

  • 2.5 times average total monthly payroll costs incurred in the one-year period before the loan is made (or for seasonal employers the average monthly payroll costs for the 12 weeks beginning on February 15, 2019, or from March 1, 2019 to June 30, 2019);
  • PLUS the outstanding amount of a loan made under the SBA’s Disaster Loan Program between January 31, 2020 and the date on which such loan may be refinanced as part of this new program;


Upon request, for businesses that were not in existence during the period from February 15, 2019 to June 30, 2019 –

  • 2.5 times the average total monthly payroll payments from January 1, 2020 to February 29, 2020;
  • PLUS the outstanding amount of a loan made under the SBA’s Disaster Loan Program between January 31, 2020 and the date on which such loan may be refinanced as part of this new program;

Use of Proceeds

Allowable uses of the loan funds include, but are not limited to:

  1. Eligible payroll support;
  2. Interest paid on a mortgage (excluding any prepayment of or payment of principal);
  3. Rent or lease payments;
  4. Utility payments; and
  5. Interest on any other debt obligations incurred prior to February 15, 2020.


While final guidelines have not yet been published by the SBA and may vary from lender to lender, business owners should begin preparing documentation for the application process. Below is a non-exhaustive list of information and documentation that regional lenders are requiring as part of this program’s application process.

  • Completed loan application. Applications have not been universally finalized by lenders yet and you should reach out to a representative from your lending institution on their specific requirements, but SBA Form 1919 would likely serve as an instructive template;
  • Articles of Incorporation/Organization of each borrowing entity;
  • Bylaws/Operating Agreement of each borrowing entity;
  • Copies of all owners’ Driver’s Licenses;
  • Payroll Expense Verification documents to include:
    • IRS Form 940 and 941
    • Payroll Summary Report with corresponding bank statement.
      • If a Payroll Summary Report is not available, Employee Pay Stubs as of February 15, 2020 (or corresponding period) with corresponding bank statement, and,
      • Breakdown of payroll benefits (vacation, allowance for dismissal, group healthcare benefits, retirement benefits, etc.)
    • 1099s (for independent contractors);
    • Certification that all employees live within the United States. If any do not, provide a detailed list with corresponding salaries of all employees outside the United States;
  • Trailing 12-month Profit and Loss Statement (as of the date of application) month by month;
  • Most recent Mortgage Statement or Rent Statement (Lease);
  • Most recent utility bills (Electric, Gas, Telephone, Internet, Water).

To keep up to date on when these programs become available, please stay in contact with your bank representatives and local Small Business Administration (SBA) District Office, which you can locate here. If you have any questions about the application process or any of the required documentation, please do not hesitate to reach out to our team.