The loan is called the Economic Injury Disaster Loan Program and administered through the Small Business Administration (SBA). Small Business Owners, Landlords, and Independent Contractors are eligible to receive up to a $2 million loan. It should be noted this is not the Paycheck Protection Plan loan. You cannot receive both the Economic Injury Disaster Loan AND the Paycheck Protection Plan loan for economic damages from COVID-19.
Facts About Economic Injury Disaster Loan Program
- All payments and interest will be deferred through the end of 2020.
- The business may be a sole proprietorship, partnership, corporation, or any other legal form with less than 500 employees.
- The Business Must exist prior to January 30th, 2020.
- Personal guarantees will not be required for loans of less than $200,000.
- To expedite the process the SBA will not be verifying tax records and will only rely on the credit score for determining the applicant’s ability to pay for loans less than $500,000.
- The term of the loan is up to 30 years to pay back.
- The interest rates are 3.75% for businesses and 2.75% for nonprofit organizations.
$10,000 Advance without Repayment Obligation, Even if Application is Denied
This advance need not be repaid even if the applicant is subsequently denied an EIDL as long as the funds:
- Providing paid sick leave to employees unable to work due to the direct effect of the COVID-19
- Maintaining payroll to retain employees during business disruptions or substantial slowdowns
- Meeting increased costs to obtain materials unavailable from the applicant’s original source due to interrupted supply chains
- Making rent or mortgage payments
- Repaying obligations that cannot be met due to revenue losses
To apply for the Economic Injury Disaster Loan Program Click Here!