SBA Economic Injury Disaster Loan Program (EIDL)

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Summary	Economic Injury Disaster Loan is a low-interest, fixed-rate loan, with extended terms, purposed to offset a lack of working capital for small businesses. EIDLs can be used to pay for operational costs such as rent, utilities, and payroll. Applicants should receive a grant up to $10,000 with an allocation of $1,000 per employee as of January 31.
Who should consider applying?	Businesses with need for quick cash to support operations. Businesses that have long-term working capital needs other than payroll, rent, interest, and utilities that exceed the funds available through the Paycheck Protection Program.
Highlights	– Up to $10,000, with an allocation of $1,000 per employee as of January 31. – Loan amounts up to $2 million – First year of payments are deferred – Loan terms up to 30 years 3.75% interest
Where do I apply?	Apply directly through SBA’s website at covid19relief.sba.gov
What forms and information will I need to apply?	1. Application (SBA Form 5 or Form 5C  for Sole Proprietorships)  Other information that might be requested by SBA and helpful to have on hand: 1. IRS 4506T for applicant business and all 20%+ owners 2. Most recent copy of business tax return 3. Schedule of Liabilities (SBA Form 2202)  4. Personal tax returns for all principals 5. Business year-end financial statements Current P&L (within 90 days) 6. Monthly Sales figures (SBA Form 1368)

FAQ

Are businesses and private non-profits in my state eligible for an EIDL related to COVID-19?

 Yes, those suffering substantial economic injury in all 50 states, DC, and the territories may apply for an EIDL. 

What is an EIDL and what is it used for?

EIDLs are lower interest loans of up to $2 million, with principal and interest deferment at the Administrator’s discretion, that are available to pay for expenses that could have been met had the disaster not occurred, including payroll and other operating expenses.   

Who is eligible for an EIDL?

Those eligible are the following with 500 or fewer employees:
– Sole proprietorships, with or without employees
– Independent contractors
– Cooperatives and employee owned businesses
– Tribal small businesses

Small business concerns and small agricultural cooperatives that meet the applicable size standard for SBA are also eligible, as well as most private non-profits of any size. See below for more info on size standards. 

My private non-profit is not a 501(c)(3). Is it still eligible for an EIDL and a grant?

Yes, if you are a private non-profit with an effective ruling letter from the IRS, granting tax exemption under sections 501(c), (d), or (e) of the Internal Revenue Code of 1954, or if you can provide satisfactory evidence from the State that the non-revenue producing organization or entity is a non-profit one organized or doing business under State law. If you are uncertain whether you qualify, please consult with legal counsel to determine whether your organization meets program criteria. 

Who is eligible for an Emergency Economic Injury GRANT?

Those eligible for an EIDL and who have been in operation since January 31, 2020, when the public health crisis was announced.  

Can I use an EIDL to make payments on my existing SBA loans or on other long-term debt obligations?

Yes. 

Is collateral required?

Unsecured loans are available up to $25,000. Loans over that amount will require collateral with real estate preferred. Note, the SBA will not decline a loan for lack of collateral but will require borrowers to pledge what is available.

Do EIDLs have prepayment penalties?

No.

Once I get approved, how are the funds disbursed?

SBA will  send  the approved business all of the loan closing documents with instructions. The small business is required to execute the documents according to the instructions and return to SBA. Once executed documents are received by SBA, funds will be disbursed directly into the business’s bank account.  

If I am applying for or have received an Economic Injury Disaster Loan, is my small business eligible to participate in the Paycheck Protection Program?

Borrowers can apply for both an SBA Economic Injury Disaster Loan and the Paycheck Protection Program loan. However, the Paycheck Protection Program loan funds and the Economic Injury Disaster Loan funds cannot be used for the same purpose. If you receive an EIDL and have used it for payroll costs, your PPP loan must be used to refinance your EIDL. The outstanding EIDL balance will be added to your maximum eligible PPP request. In that case, the $10,000 EIDL grant will be deducted from the loan forgiveness amount of the PPP loan.  

What if I have more questions?

 You can always call OSDC at 614-481-3214. We’re here to help. You can also call the SBA Customer Service Center at 800-659-2955. 

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10-year	20-year	25-year
6.78%	6.34%	6.33%

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