How to Take Benefits of the CARES Act as a Mortgage Broker

David Cohn
Sep 10, 2020

Being a part of the commercial real estate investing industry, we are passionate about helping mortgage brokers make their businesses stronger. The COVID-19 pandemic has, no doubt, made it harder for everyone to do business as usual.

The good news is, mortgage brokers can apply for financial assistance from the U.S. government under the CARES Act (which stands for Coronavirus Aid Relief and Economic Security).

And efforts to provide accurate information and guidance, we have listed below some of the most important details you need to know if you are a mortgage broker wishing to take benefits from the CARES Act.

We hope that this information can guide you in figuring out if any recently legislated financial assistance programs can help sustain your business as we deal with this health crisis.

Many brokers don’t realize that the quality of aid under the CARES Act. The Department of Treasury and the Small Business Administration have been releasing the material on this program's provisions.

If you’re wondering if, as a broker, you are eligible for relief under CARES, then read on to find the answers below.

Make note that the provisions of the CARES Act may change over time. The data used in this blog is derived from official information as of April 2020.

Please check the websites of both the Department of Treasury and the Small Business Administration for additional info.

Congress has allocated a $349 billion fund for the Paycheck Protection Program as of April 2020. Additional funds may be infused into the program.

If you failed to apply for assistance previously but are now thinking about doing so for your business, submit your application as soon as new funds become available, via an approved financial institution.

The information below does not constitute legal advice. We’ve done our very best to present accurate information about how mortgage brokers can benefit from the CARES Act, but we cannot offer official recommendations. This blog is purely informational. Depending on your situation, it might make sense to consult a legal or financial professional before taking action.

Understanding the CARES Act 2020

The CARES Act and programs associated with it are designed to assist individuals and business owners during these uncertain times. Two of the act’s resources, in particular, provide cash-flow assistance to businesses that have been affected by the pandemic:

What is a Paycheck Protection Program (PPP)?

More commonly referred to as the PPP, this program is meant to give small businesses assistance with their cash flow through 100% federally guaranteed loans.

The loans are forgiven if employers maintain their payroll during this health care crisis. We discuss this further below.

Does your brokerage qualify?

Small and independent mortgage brokers may be eligible for PPP relief. To be sure, you need to apply through a local lender or bank.

Up to eight weeks’ worth of payroll loan may be forgiven depending on salary levels and how many employees your business retains. Other PPP features include no SBA fees and deferrals of six months to a year.

Your small business may qualify if you were harmed by the pandemic between February 15 and June 30, 2020.

The government has listed additional qualifications for PPP loans, and they apply to many brokerage firms:

  • Businesses that have been operational on or before February 15, 2020
  • Small businesses with less than 500 employees or less than the applicable size standard as set by the NAICS as provided by SBA
  • Individuals operating sole proprietorships or working as independent contractors
  • Eligible self-employed individuals
  • Businesses employing less than 500 employees per physical office/location and assigned NAICS codes that begin with 72
  • Businesses operating as franchises, assigned franchise identifier codes, and receives funding through an SBIC

Where can the funds be used?

Mortgage brokers can use PPP funds for an array of business costs, including the following:

  • Payroll
  • Expenses necessary to continue group health care benefits
  • Employee salaries and other compensations, including commissions
  • Rent/lease
  • Interest payments on any mortgage obligation (cannot include any prepayment/payment of principal)
  • Utilities
  • Payments of interest for any other debt obligation incurred before the coverage period

How do you qualify for PPP loan forgiveness?

Brokers need to apply through their lenders to be eligible for loan forgiveness. If you’re interested, make sure that your application includes the following:

  1. Proof of payments on covered lease obligations, mortgage obligations, and utilities
  2. Documentation confirming how many employees are on the payroll and their pay rates (this can include IRS payroll tax filings, payroll, and unemployment insurance filings)
  3. Certification from a representative of your company or an organization authorized to certify that truthfulness of the documentation provided and that the amount being forgiven was used for allowed purposes based on the program’s guidelines

How to apply for the paycheck protection program?

Current SBA 7(a) lenders are qualified PPP lenders. The Department of Treasury is set to authorize new lenders, including nonbanks, to meet the requirements of small business owners more effectively. If you’re interested in this program, contact your local bank.

Emergency Economic Injury Grant

The grant gives small businesses a quick infusion of cash in a smaller amount. It will help them to cover immediate business needs.

An emergency advance capped at $10,000 can be provided to small businesses (including brokerages) affected by the COVID-19 pandemic within three days of applying for an Economic Injury Disaster Loan from the SBA.

To qualify, your business must have fewer than 500 employees. This is why most brokerage firms are eligible.

Your business should also have been operating since January 31, 2020, which was at the date the healthcare crisis was announced.

Sole proprietorships (even those without employees), cooperatives, independent contractors, tribal small businesses, and employee-owned businesses are included.

Does the grand have to be repaid?

No. The grant doesn’t have to be repaid under any condition.

How can money be used?

The grant can be used for many purposes, including keeping employees on the payroll, meeting higher production costs brought on by supply chain disruptions, paying for sick leave, and paying business obligations such as rent and mortgage payments and debts.

Are these grants still available?

Yes. Until December 31, 2020, these grants are retroactive to January 31, 2020, to allow businesses that have already applied for EIDLs to receive a grant.

How to apply for an emergency economic injury grant?

The first step to accessing the grant is to apply for an EIDL. Then you can request the advance. You can apply for an EIDL online. Simply visit

Other sources of assistance

You can get a lot of important information from your SBA District Office. They can give you official advice on what financial assistance programs your business may qualify for.

Likewise, the government is giving additional funding to resource partners, including local Small Business Development Centers, SCORE mentorship chapters, and Women’s Business Centers.

These organizations can give businesses affected by the current crisis, additional guidance, and counseling for free. You can find local resource partners online by visiting

Moving forward with cautious optimism

The pandemic is affecting the real estate industry in magnitudes never seen before. But it’s not all hopeless. The govt works hard to support small businesses in this industry, infusing billions of dollars in aid and stimulating the economy. Take advantage of any financial assistance that you may be eligible for to help yourself, and your employees weather the storm.

Mortgage brokers will undoubtedly face significant business challenges in the coming months as the country grapples with this crisis.

We hope you found useful information in this blog—information that you can use to prevail over the hardships you may be facing right now. Together as a community, we can emerge from this crisis.