To date the SBA has approved $197 billion in low-interest loans which provides working capital funds to small businesses.
On April 6, early EIDL applicants received emails that contained new information about this government assistance program. The SBA confirmed earlier rumors that the grant portion will be paid out at $1,000 per employee up to a maximum of $10,000. Sole proprietors and single-owner small businesses that have no employees but themselves have been receiving $1000 since the email was sent out.
According to the email, no grants (advances) were to be distributed until a business moves forward and submits a FULL EIDL application. Update – the email that went out on April 6th appears to have been incorrect. Since then, small businesses have been receiving the grant/advance into their bank account with no correspondence received from the SBA first. After receiving the grant, the business, if eligible, has received an email from the SBA inviting them to create an account on the SBA loan portal. Once an account is created, the business can find out how much of the full EIDL loan they are eligible for and apply if the loan is needed.
The SBA is currently accepting new EIDL loan applications.
The CARES Act expanded the Small Business Association’s (SBA) existing EIDL program by relaxing eligibility requirements under the program and increasing the funding through December 31, 2021. Under this program, the SBA offers EIDL Loans of up to $2 million for small businesses to recover from temporary losses following a state-wide economic injury declaration to include losses experienced from the COVID-19 outbreak. The expansion under this law was made to include sole proprietorships, with or without employees, and independent contractors.
You are eligible if your business was in existence on and prior to January 31, 2020, you are a sole proprietorship, with or without employees, an independent contractor, self-employed individuals, or a business with no more than 500 employees.
*Be sure to review your loan documents thoroughly and have your attorney review before signing.
No, the CARES Act waives that requirement.
The SBA must make the determination that the applicant has the ability to repay the loan. In addition to this, the SBA can approve a loan based solely on the credit score of the applicant or other means for determining the ability to repay the loan.
The grant/advance does not have to be repaid. However, if you receive the EIDL advance and a PPP loan, the amount of the EIDL advance will reduce the amount of your PPP loan forgiveness.
The full EIDL loan is NOT forgivable. Here are the details of the loan included in the email –
Other details previously released –