There have been extensive updates to the SBA Disaster Loan program in both the FFCRA and the CARES Act. Because of COVID-19, essentially all small businesses in the US are eligible for SBA Economic Injury Disaster Loans; in addition, the CARES Act added a grant of up to $10k for small businesses who apply with the SBA for a disaster loan, whether or not the loan is ultimately approved.
“On Thursday evening, a senior administration official told CNBC that nearly 4 million businesses had applied for EIDL funding for a total of $383 billion, adding that Congress has allocated $17 billion for the program.”
CNBC.com April 9, 2020
- Who: All US small businesses (by SBA standards) who have been impacted by COVID-19
- What: A loan at 3.75% interest for 10-30 years, with a deferral of initial payments for XXX (2019 revenue – 2019 COGS / 2)
- When: Theoretically now, although the SBA has been overwhelmed with applications; current deadline is Dec 16, 2020
- Where: Apply directly with the Small Business Administration
- How: Fill out a straightforward form, then wait to hear from the SBA; if you want the grant of up to $10k, check the box on the application form
- Why: The disaster loans and the associated grant are designed to help small businesses survive the COVID-19 crisis; they don’t have the strings attached to spending that the PPP loans and some of the other programs do
Places to Get Official Information
Start Here
- SBA Application for EIDL Loan (with EIDL Grant checkbox)
- An SBA slide deck about COVID-19 relief for small businesses which includes information on EIDL loans & grants
- Benefits.gov description of EIDL
Extra Credit
- The portion of the CARES Act that creates the EIDL Grants
Places to Get Unofficial Information
- US Chamber of Commerce guide to the EIDL loans