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Economic Injury Disaster Loan

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Economic Injury Disaster Loan Details

The Economic Injury Disaster Loan (EIDL) is a component of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

How to apply for a SBA loan

Emergency Advance Grant

At this time, the EIDL advance program is out of money. The SBA provided over $20 billion in financing to nearly six million businesses.

When funds were available, businesses could qualify for a forgivable Emergency Advance Grant of up to $10,000  within three business days. This grant doesn’t need to be repaid, as long as its used for debt that can’t be repaid due to COVID-19, materials, paid sick leave, and payroll.

If the advance program is extended, we will provide updates.

Apply-Unsecured-Business-Loan

What Else Can I Do To Help My Business?

There are other components of the CARES Act, along with state and local programs created to help small businesses during these unprecedented times.  To learn more about other financial relief options for business owners, click here.

Key Features of the EIDL

If your business is in a declared disaster area, you can pursue an Economic Injury Disaster Loan from the SBA. Unlike the EIDL advance, this financing is not forgivable.

  • Qualification Requirements:

Most U.S. Small Businesses with 500 employees or less qualify for the EIDL. In addition, most individuals who operate under a sole proprietorship, with or without employees, or as an independent contractor. During the application process, the SBA will run a credit check.

Certain industries will not be eligible, these include pornography related businesses, farms, and gambling establishments. In addition, businesses where an owner with 50%+ ownership and are more than 60 days delinquent on child support.

Businesses that were established on January 31st, 2020 or before are eligible for this loan.

  • Loan Amount & Terms:

You can receive up to $2 Million with a maximum term of 30 years.

  • Interest Rates & Fees:

The interest rate is 3.75% for small businesses, while the interest rate for non-profits is 2.75%. There is no application fee.

  • Time to Funding:

Per current SBA guidance, you can receive this loan within 2 to 3 weeks of applying.

  • Collateral Requirements:

Collateral is not required for loans of $25,000 or less. For loans exceeding $25,000, collateral is a blanket UCC lien against the assets of the business. The SBA does not decline loans for lack of collateral.

  • Personal Guarantee Requirements:

There are no personal guarantees required for loans up to $200,000. If your loan exceeds this amount, a personal guarantee is required for anyone that owns more than 20% of the business, managing members of LLCs, and managing partners of LPs.

  • Use of Funds:

This financing can be used to pay business expenses such as fixed debts, payroll, accounts payable, rent, utilities, and other bills.

  • How to Apply:

You can apply directly through the SBA by clicking here.

  • Deadline to Apply:

Loans are available through December 31st, 2020, but funds are limited so time is of the essence.

  • Loan Deferment Options:

If you receive this loan, it can be deferred for one year after loan origination. In addition, recipients can prepay without penalty at any time.