When it comes to getting a Covid-19 relief loan fast, it pays to hedge your bets and apply at different lenders--but doing so may land you in trouble with law enforcement.
Having multiple lenders submit a loan application to the government on your behalf will trigger a fraud alert, says Ami Kassar, Inc. columnist and founder and CEO of MultiFunding, a small-business loan adviser. You cannot get more than one loan under the $349 billion Paycheck Protection Program.
But that doesn't mean you should only apply at a single lender. The chaos of the program's roll out along with the fact that different banks have deployed different resources and processes to address the influx of these loans, might necessitate applying at mutliple lenders.
Kassar suggests that if you do go this route, just make sure to ask for a guarantee that the lenders will contact you before submitting your file. That way you can immediately withdraw your other applications.
Last week, the the U.S. Small Business Administration announced that financial institutions are required to notify law enforcement if they detect fraud, money laundering, terrorist financing, misuse financial institutions, or other criminal acts. And being accused of fraud will most likely hinder your ability to get a loan, in any shape or form. Steer clear of other potential abuses, too. Business owners' needs will likely amplify as the crisis continues, and that's bound to attract fraudsters.