SBA Economic Injury Disaster Loan (EIDL) Program: COVID-19 - YouTube

Today's Maverick Minute... SBA disaster loans.

Has your business been impacted by COVID-19?

Let’s dive in and explore the Economic Injury Disaster Loan Program.

The Small Business Administration

offers low-interest loans to help small business owners

after a disaster. FEMA recommends to apply for an SBA loan

to cover gaps in insurance coverage or to provide bridge funding before

the insurance check arrives.

With the coronavirus pandemic

affecting so many small businesses, we are gonna focus this video on the SBA's

Economic Injury Disaster Loan Program

The SBA’s EIDL program

is an opportunity for small businesses to receive

working capital of up to $2 million dollars.

So, who is eligible for an Economic Injury Disaster Loan program?

First, you'll need to be located in a disaster declared county or a contiguous county.

So if you are experiencing hardship that is UNrelated to COVID-19,

you’ll have to check to see if your region qualifies for an EIDL.

However, in response to the Coronavirus pandemic,

small business owners in all US states, Washington DC and

territories are

eligible to apply for an Economic Injury Disaster Loan Advance of up to $10,000.

The CARES Act, signed into law on March 27, 2020

established several temporary programs to address COVID-19.

Among these new programs is the EIDL Loan Advance.

Upon a successful EIDL application,

advance funds, up to

$10,000 will be made available

within days!

This advance loan WILL NOT have to be repaid.

Now,

eligibility for this program

is open to small businesses with less than 500 employees.

This includes sole proprietorships,

independent contractors and

self-employed persons.

Also,

private non-profit organizations or

501(c)(19) veterans organizations affected by COVID-19.

And also,

Some businesses may have more than 500

employees IF they

meet the SBA’s size standards in their particular industry.

The SBA is expecting small businesses to run into problems in a number of different areas

such as capital access

workforce capacity

inventory, or supply chain shortfalls

or marketing needs,

just to name a few.

The EIDL offered for COVID-19 affected businesses can be used to pay debts,

payroll,

accounts payable or other

expenses related to

difficulties caused by the virus.

Note that you MUST NOT have other sources of credit available to qualify for these loans.

The interest rate is

3.75% for small businesses and

2.75% for nonprofits.

The maximum term length is 30 years, although

the terms will vary, depending on your circumstances.

In addition to your business being located in an officially declared

disaster area, there are some other guidelines to keep in mind when it comes to eligibility.

The SBA will perform a credit check. If you need more than

$25,000, the SBA will likely require collateral to secure your loan.

Now, the Economic Injury Disaster Loan program is set up to be as accessible as possible

so you’ll be considered whether you have collateral or not.

To understand more about what lenders look for, check out our 5cs of Credit video!

For more information on the SBA disaster loan program and

application process,

I invite you to read our full articles at our website.

So click the links and drop us your questions in the comments below.

And don't forget to subscribe to our channel to get more information,

guidance and support! See you next week!

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