The Small Business Administration will soon be increasing the lending limit to businesses and nonprofits. That’s one of five facts the SBA wants organizations to know. Here’s more details:
- The lending limit will increase to $500,000 in April
Starting the week of April 6, the SBA will increase the maximum amount small businesses and nonprofit organizations can borrow through the COVID-19 Economic Injury Disaster Loan (EIDL) program from 6 months of economic injury with a maximum loan amount of $150,000 to up to 24 months of economic injury with a maximum loan amount of $500,000.
Businesses that receive a loan subject to the current limits do not need to submit a request for an increase at this time. Rather, the SBA will reach out directly via email and provide more details about how businesses can request an increase closer to the April 6 implementation date. Click here for more information.
- The deferment period is extended until 2022The SBA has extended deferment periods for all disaster loans, including the COVID-19 EIDL program, until 2022.All SBA disaster loans made in calendar year 2020 will have a first payment due date extended from 12 months to 24 months from the date of the note.All SBA disaster loans made in calendar year 2021 will have a first payment due date extended from 12 months to 18 months from the date of the note. Click here for more information.
- You can receive an EIDL and a PPP or SVOGYou can receive an EIDL and also receive a Paycheck Protection Program (PPP) loan or a Shuttered Venue Operators Grant (SVOG). However, they can not be used for the same purpose or costs as the EIDL.An EIDL helps businesses meet financial obligations and operating expenses that could have been met had the disaster not occurred. The terms are for 30 years at a 3.75% fixed interest rate for businesses and 2.75% fixed interest rate for nonprofits. Unlike the PPP, an EIDL is not forgivable. Click here for more information.
- The SBA has guidance for identity theft and fraudIf you suspect that someone used your personal information without your knowledge or permission to obtain an SBA COVID-19 EIDL, download this EIDL identity theft letter for step-by-step instructions on how to report the identity theft case to the SBA, including how to file an SBA Declaration of Identity Theft.The letter also includes recommended next steps you should take to protect yourself from further financial harm as a result of identity theft, such as reporting the identity theft to the Federal Trade Commission (FTC) at IdentityTheft.gov as well as adding a fraud alert or credit freeze to your credit reports. Click here for more information.
- Billions of dollars to businesses … and countingOne year ago this month, the SBA opened the EIDL program to small businesses and nonprofits impacted by COVID-19, the first time the program was used for a pandemic. Since then, more than $7 billion in EIDLs have gone to entities in the Pacific Northwest (Washington, Oregon, Idaho and Alaska).In fact, the number of COVID-19 EIDLs approved by the SBA nationwide is three times the volume of all previous disaster loans combined since the agency’s inception in 1953.The SBA continues to accept new COVID-19 EIDL applications from all qualified small businesses, including agricultural businesses, and private nonprofit organizations. The deadline to apply for a COVID-19 EIDL is Dec. 31, 2021. Click here to apply for EIDL.
