Media headlines hint trouble with relief monies promised to small businesses. Those funds seem to be quickly running dry. But entrepreneurs hope to see lawmakers approve $250 million in additional support. The money funds the CARES Act’s Payroll Protection Program (PPP). In the meantime, business owners need to apply for aid from the Small Business Administration (SBA) Economic Injury Disaster Loan (EIDL) program. The program already existed. But it received a boost in availability and terms from the CARES Act. Check out this primer on what you need to know.
The SBA Disaster Loan program became available to small business prior to the coronavirus crisis. But monies and approvals ended up less forthcoming than the new EIDL promises to be. In fact, in all of 2019 the SBA only guaranteed $28 billion worth of loans. As of mid-March 2020, the SBA revised criteria for states or territories seeking an economic injury declaration related to the coronavirus (COVID-19). The new program assures applicants:
The CARES Act relaxed the broader state requirements. It also waives:
Temporarily, the CARES Act also increases the amount of funding available through December 31, 2020. Small businesses may apply for an EIDL loan of up to $2 million. The loan features a 3.75% interest rate for small businesses and 2.75 percent for nonprofits. And it features a maturity of up to 30 years. Lenders determine the actual loan terms on a case-by-case basis. The CARES Act also provides for a $10,000 emergency grant. And lenders can fund it within three days of the application. But it makes up the only forgivable portion of the loan. Applicants receiving the $10,000 emergency funding, but not approved for the entire EIDL, need not repay the advance.
If You Still Have Questions Read on
Still have questions? Hopefully, this helps make sense of it all.
What kind of documentation do I need to apply? Per the SBA Disaster Loan Application Portal, you will need:
Help With EIDL ApplicationThe SBA and SBA lenders got flooded with applications. And so far, small business owners remain proactive by filing applications as soon as possible. If you are able to apply for the EIDL directly through the SBA website, we strongly urge you to do so soon. If you’d like some assistance in the process, CorpNet can assist you in preparing and submitting your EIDL application to the SBA on your behalf.
CorpNet can assist any small business owner as a third-party consultant SBA loan packaging service and submit a small business owner’s application on their behalf for the Economic Injury Disaster Relief Loan (EIDL) program and the Economic Injury Disaster $10,000 Loan (EIDL) Advance for a minimal service fee of $349.
CorpNet also assists small business owners as a third-party consultant SBA loan packaging service. And we submit a small business owner’s application on their behalf for the Paycheck Protection Program (PPP) Disaster Relief Loan at no cost.
You won’t find anyone (including CorpNet) to guarantee you loan approval or funds. And processing time remains at the mercy of the government. Your application vies with thousands or millions of others for attention. The SBA says funds become available following a successful application. Expect a wait of several business days for funding of the $10,000 advance. Information provided by the U.S. Department of Treasury says direct deposit follows. Allow 4 to 6 weeks processing time for actual funding of your loan. Unless further information has been requested by an SBA loan processor.
We understand the stress and challenges small business owners face today. We offer help so you don’t get overwhelmed. Read more on how CorpNet Helps Businesses File for Coronavirus Relief.
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