The Rebound: Hardship Program available to small businesses

Posted at 9:26 PM, Jun 21, 2020
and last updated 2020-06-21 22:23:32-04

COMSTOCK PARK, Mich. — The Paycheck Protection Program has helped many small businesses survive being shutdown during the pandemic, but not every small business that applied was able to receive it.

According to Dr. Michael Grayson, a Ph.D. in Business Administration, not enough small businesses are taking advantage of another part of the CARES Act.

“No one is talking about the provision in the CARES Act that requests that creditors offer some type of hardship program," Dr. Grayson said.

According to Dr. Grayson, creditors will allow small businesses to defer their payments without damaging their business credit.

Dr. Grayson, calls the hardship program a “safety net” provided by Congress and the President, adding that businesses have to formally ask for it.

“You’ve got to do it because if you haven’t had any revenues in a couple months, you have to stop the bleeding first," Dr. Grayson said. “It’s called the Hardship Program, you have to ask for it by name. You can’t say ‘Well, I’m having trouble with my payments, what do I do?’ They’re not going to help you. (You have to inform them) ‘I would like to enroll in your Hardship Program.’”

Dr. Grayson has a book for sale on Amazon right now appropriately titled, “How To Stop Making Payments”, adding, “(the book) has all the forms in it that you send out to the creditors, explains step by step how to get the deferment.”

By being late on payments, a business risks hurting its credit, Dr. Grayson said.

“You have to preserve your credit because ultimately banks are going to be lending like crazy," Dr. Grayson said. "It’s going to force them to do that, but they’re only going to loan to people (businesses) with good credit scores.”

Dr. Grayson said when a business damages its credit, it’s usually easier for that business to create a new entity than trying to fix the credit.

“We know that small businesses employ 67% of the workforce, so we need them to reopen and reopen strong," Dr. Grayson said.