LAST UPDATED: APRIL 22, 2020

The EIDL is for businesses that have experienced financial losses as a result of COVID-19. The loan gives up to $2mm in aid to businesses, including a $10,000 emergency cash advance. You will not need to repay the cash advance if you are denied the loan. If you are approved of the loan, this cash advance is included in the total loan amount you receive. 

The amount that you can borrow is based on the economic losses that you have sustained. The funds can be used as working capital to pay bills, fixed debts, payroll, and accounts payable. The funds can not be used to replace lost sales, expand your business, or to pay down long-term debt. 

The interest rate for an EIDL is 3.75% for small businesses and 2.75% for nonprofit organizations. Repayment terms vary based on the borrower’s ability to repay the loan, and the maximum repayment term is 30 years. 

If you have a question that you don't see answered, or a resource that you think would be helpful for others, please fill out the FAQ Feedback Form. We will do our best to incorporate new questions into this document.

Step 1
Determine if you are eligible for an EIDL. See FAQ #1 below to determine eligibility. 

Step 2
Gather the following business information to submit your application

1. Business information:
   • Business legal name
   • Trade name
   • Employer identification number (EIN) or social security number (SSN) for sole proprietorship
   • Organization type
     1. Limited Liability Company
     2. Sole Proprietorship
     3. C-Corporation
     4. S-Corporation
     5. General Partnership
     6. Limited Liability Partnership
     7. Limited Partnership
     8. Cooperative
     9. Trust
     10. Independent Contractor
     11. Other
   • Whether the business is a non-profit organization or a franchise
   • Total gross revenue from February 1, 2019 through January 31, 2020
   • Total cost of good sold from February 1, 2019 through January 31, 2020
   • If you are a rental and commercial property owner: Total amount of lost rents due to COVID-19
   • If you are a nonprofit: Total nonprofit operation costs from February 1, 2019 through January 30, 2020
   • Date business established
   • Current ownership since
   • Business activity
   • Number of employees
2. For each owner you will need to know their:
   • Legal name
   • Title
   • Ownership percentage of the company
   • Social security number
   • Date and place of birth
   • Citizenship status
   • Residential street address
3. Your bank name, account number, and routing number. 

Step 3
It is highly encouraged to apply for the EIDL online using this website. The online application is the fastest way to receive a decision about your loan. You may also apply for an EIDL in person at a Disaster Recovery Center or by mail. 

The SBA estimates that the online application will take 2 hours to complete. 

Step 4
The SBA is targeting to pay the $10,000 emergency cash advance within three days of submitting your EIDL application; however, this may take longer due to demand

Step 5
The SBA usually makes a decision on your loan within 2-3 weeks. However, this process may take longer with an increased number of applications. During this time, a loan officer may ask you for more information and next steps. However, under the CARES act, the EIDL can be approved by the SBA based on just a credit score alone. 

Step 6
The SBA will send you loan closing documents to sign. Once the documents are signed, an initial disbursement of $25,000 is made within 5 days. You will be assigned a case manager who will help you meet the loan conditions and schedule future disbursements. 

Eligibility

1. Am I eligible? Show Comment Hide Comment

   You are eligible for an EIDL loan advance if you are one of the following:

   1.  A business, cooperative, employee stock ownership plan, or tribal small business concern with not more than 500 employees
   2. A business that is small under SBA Size Standards found at https://www.sba.gov/size-standards
   3. A sole proprietorship or independent contractor
   4. A private non-profit organization that is tax exempt under sections 501(c),(d), or (e) of the Internal Revenue Code of 1954
2. How do I determine if I am ineligible? Show Comment Hide Comment

   Businesses that are not eligible:

   1. Applicant is engaged in any illegal activity (as defined by Federal guidelines)
   2. Principal of the Applicant with a 50 percent or greater ownership interest is more than sixty (60) days delinquent on child support obligations.
   3. Applicant is an agricultural enterprise (e.g., farm), other than an aquaculture enterprise, agricultural cooperative, or nursery.
   4. Applicant presents live performances of a prurient sexual nature or derive directly or indirectly more than de minimis gross revenue through the sale of products or services, or the presentation of any depictions or displays, of a prurient sexual nature.
   5. Applicant derives more than one-third of gross annual revenue from legal gambling activities.
   6. Applicant is in the business of lobbying.
   7. Applicant is a state, local, or municipal government entity and is not a member of Congress.
   8. The business or a listed owner have been convicted of a criminal offense committed during and in connection with a riot or civil disorder or other declared disaster within the last year and have never been engaged in the production or distribution of any product or service that has been determined to be obscene by a court of competent jurisdiction
   9. Applicant or any listed owner is currently suspended or debarred from contracting with the Federal government or receiving Federal grants or loans?
   10. Applicant or any listed owner is presently subject to an indictment, criminal information, arraignment, or other means by which formal criminal charges are brought in any jurisdiction? 
   11. Applicant or any listed owner have been arrested in the past six months for any criminal offense
   12. Applicant or any listed owner have been convicted, plead guilty, plead nolo contendere, been placed on pretrial diversion, or been placed on any form of parole or probation (including probation before judgment) for any criminal offense - other than a minor vehicle violation
3. Is there anything else that could impact my eligibility? Show Comment Hide Comment

   The SBA will perform a credit check when you apply. The SBA doesn’t give any guidelines on what your credit score must be, other than “acceptable to SBA”; however, if you don’t have good business credit, the SBA will consider other factors, like your history of on-time rent, utilities, insurance, and other bill payments.

Loan Amount

1. How is the loan amount determined? Show Comment Hide Comment

   An SBA verifier will estimate the total property damage or economic loss to your business to determine the loan amount. The loan processor may request the following information for aid in amount determination: Personal Financial Statement (SBA Form 413), Schedule of Liabilities (SBA Form 2202), and Tax Information Authorization (IRS Form 4506T) 

Loan Proceeds

1. How can EIDL loans be used? Show Comment Hide Comment

   The loans are to be used as working capital to pay bills, fixed debts, payroll, or accounts payable. 

2. What are the loans not eligible to be used for? Show Comment Hide Comment

   You cannot use the loan to pay:

   1. Dividends and bonuses
   2. Disbursements to owners (unless for the performance of services)
   3. Repayment of stockholder/principal loans
   4. Expansion of facilities or purchasing fixed assets
   5. Paying off debt owned by a Federal agency or SBA
   6. Paying any direct Federal debt, except IRS obligations
   7. Refinancing long-term debts
   8. Relocation

Loan Forgiveness

Loan Details

1. What is the interest rate and loan term on an EIDL loan? Show Comment Hide Comment

   Currently, the interest rate is 3.75% for small businesses and 2.75% for nonprofit organizations. Repayment terms vary based on the borrower’s ability to repay the loan with a maximum repayment term of 30 years. 

2. How quickly will I receive my funding? Show Comment Hide Comment

   The SBA originally said applicants will be paid the advance within three days of submitting the EIDL application; however, they are now saying this may take longer due to higher than anticipated demand.

3. Are there any collateral or personal guarantees? Show Comment Hide Comment

   For EIDL loans under $200,000, no personal guarantee is required. Loans of $25,000 or less require no collateral. For loans above $25,000, general security interest in business assets can be used.

4. Do you have to validate that you couldn’t get funding elsewhere? Show Comment Hide Comment

   No, under the CARES Act, you don’t have to prove that you don’t have access to credit elsewhere to qualify for the loan.

5. Can you apply for an EIDL loan if you have other SBA loans? Show Comment Hide Comment

   If you have outstanding SBA loans, you can still apply for a disaster loan. The SBA has encouraged lenders of outstanding SBA loans to defer payments for up to 12 months for borrowers in declared disaster areas. Reach out to your lender to see if you’re eligible for a deferment. If you already have an SBA disaster loan, the SBA offers an automatic deferment. 

6. Can you apply for an EIDL loan and a PPP loan? Show Comment Hide Comment

   Yes, SBA guidance allows you to apply for a PPP loan in addition to an EIDL, so long as you don't use the funds from each loan for the same expenses.