COVID EIDL Program Updates, Effective September 8, 2021
Summary
An SBA notice of COVID EIDL program updates effective September 8, 2021, with the policy changes to be publicly shared September 7, 2021. It lists an increase in the loan cap so that higher loan amounts are available, with an exclusivity period in which no loans greater than $500,000 would be approved until Oct. 8, 2021. Other changes allow funds to be used for payment and prepayment of commercial debt and payments of federal debt, allow 24 months of deferment from loan origination for all loans, and simplify affiliation requirements, defining an affiliate as a business you control or in which you have 50% or more ownership.
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COVID EIDL Program Updates
Effective September 8, 2021
COVID EIDL Policy Changes
The below policy changes will be publicly shared September 7, 2021 and effective September 8, 2021:
COVID EIDL Policy Change Impact
Increase cap from $500K to $2M Higher loan amounts available
1
“Exclusivity Period:” No approval of loans greater than $500,000 until Oct. 8, 2021
Allow for use of funds to be applied to payment and prepayment of commercial debt and Increase use of funds flexibility
2
regularly-scheduled payments of federal debt
Allow for 24 months of deferment from loan origination for all loans (existing loans with SBA automatically defers for 24
3
less than 24-month deferment will be adjusted) months from loan origination
Affiliation requirements simplified: An affiliate is a business that you control or in which Simplifies affiliation rules for all
4
you have 50% or more ownership industries
Created additional way to meet program size standards for businesses assigned a Includes industries uniquely
NAICS code beginning with 61, 71, 72, 213, 3121, 315, 448, 451, 481, 485, 487, 511, 512, impacted by COVID-19 and
5 515, 532, or 812, AND that have no more than 500 employees per physical location AND continue to experience
that have no more than 20 locations AND that meet all other COVID EIDL eligibility significant economic hardship
requirements
Added $10 million limit on maximum aggregate COVID EIDL loans to a single corporate Introduces maximum cap on
6 group. Entities are part of a single corporate group if they are majority owned, directly corporate groups
or indirectly, by a common parent
SBA.gov/EIDL
COVID EIDL Changes - Terms Green* = changes
Loan Amount $1,000 to $25,000 >$25,000 to $500,000 >$500,000 to $2 million*
3.75% (business)
Interest
2.75% (non-profit)
Repayment 30 years
Period
Deferment Up to 24 months (for all loans*) – SBA will adjust deferment on loans that did not receive 24 months
Requirements Minimum Credit Score: 570 Minimum Credit Score: 570 Minimum Credit Score: 625*
Collateral: None Collateral: >$25,000 UCC-1 Collateral: UCC-1 and business real
Personal Guarantee: None Personal Guarantee: >$200,000 estate*
Personal Guarantee: >$200,000
Normal operating expenses
• Payroll
• Rent
Use • Inventory, raw materials, variable costs
• Commercial Debt (payment and prepayment*)
• Federal Debt (includes Guaranteed and Direct Loan) (regularly scheduled payments*)
SBA.gov/EIDL
Working capital
External: >$500K Exclusivity Timeframe
New COVID EIDL Applicant COVID EIDL Increase >$500K
A new COVID EIDL applicant can pursue one of two For an applicant that has already received COVID EIDL
paths: funds and is eligible to increase their loan to >$500K,
they can apply following the below steps
1. $500K Immediately and then >$500K
1. Verify eligibility requirements met via FAQs 1. Verify initial and additional eligibility
2. Complete EIDL Intake Form via sba.gov/eidl requirements met via FAQs
3. Sign up for and complete application via SBA portal 2. Log into account on SBA portal (do not apply for
4. Receive decision within three weeks another loan) to submit loan modification
5. If approved, follow adjacent steps for a COVID EIDL 3. Receive decision after October 8th or within 1.5
increase for >$500K funds months of application submission
2. Apply for >$500K Immediately
1. Verify initial and additional eligibility requirements
met via FAQs
2. Log into account on SBA portal (do not apply for
another loan) to submit loan modification
3. Receive decision within 1.5 months
SBA.gov/EIDL
Application Details
The below timelines assume the applicant responds quickly to the SBA for any information requests and in
completing each step of the process.
Scenario Timeline
COVID EIDL Application for any funds 3 Weeks
<$500K
COVID EIDL Application for any funds 6 Weeks
>$500K
COVID EIDL Application for <$500K and 3 Weeks + 6 Weeks = 9 Weeks
then an increase for >$500K Funds
Required Documents
For loan modification applications, it is possible they will not need to submit standard documents again
Standard document requirements Additional Documents for >$500K
• Federal Income Taxes • ODA Form P-022 – Standard Resolution
• IRS Form 4506-T • SBA Form 2202 – Schedule of Liabilities
• List of Real Estate Owned
• SBA Form 413 – Personal Financial Statement
SBA.gov/EIDL
File and source
- File
- 2021-09_COVID-ProgramUpdates-09082021-508.pdf
- Size
- 241,837 bytes
- SHA-256
- c454ff2acbacbd88031fddbaaf7ce96c54acf5af94a60f872e82bde5b3a7e23a
- Original
- www.sba.gov