Full text
COVID EIDL Loans Information as of September 8,
2021
Contents
Introduction
Section 1: COVID EIDL Program Information
Section 2: Submitting a New COVID EIDL Application
Section 3: Submitting a COVID EIDL Increase Application
Section 4: Application Status and SBA Decision
Section 5: Post-Disbursement of COVID EIDL Loan Funds
Section 6: Fraud, Waste, and Abuse
Introduction
• These FAQs include the COVID EIDL program changes made in August 2021 and is the
current guidance.
• SBA is authorized to make COVID EIDL loans through December 31, 2021, or when
funds are exhausted, whichever occurs sooner. Applicants should read and
understand the requirements for submitting an application.
• You can apply for COVID EIDL loans online through SBA’s website for free. You might
receive emails or offers from third parties to assist you with your application. If you
choose to work with a third party to submit your application, you are responsible for
any fees and costs related to the third party. SBA will not accept documents signed by
a third party on your behalf.
Section 1: COVID EIDL Program Information
SBA's COVID EIDL Loan Product at a Glance
Product Loan directly from SBA that must be repaid. Low-interest, fixed-
rate, long-term loan to help overcome the effects of the
pandemic by providing working capital to meet operating
expenses
Uses of Proceeds Working capital to make regular payments for operating
expenses, including payroll, rent/mortgage, utilities, and other
ordinary business expenses, and to pay business debt incurred
at any time (past present or future)
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Maximum Loan Amount $2 million Note: SBA will begin approving loans greater than
$500,000 on October 8, 2021
Loan Term 30 years
Interest Rate Businesses: 3.75% fixed
Private nonprofit organizations: 2.75% fixed
Payment Deferment Payments are deferred for the first 2 years (during which
interest will accrue), and payments of principal and interest are
made over the remaining 28 years. No penalty for prepayment.
Fees For loans $25,000 or less: No fees if applying directly through
SBA
For loans greater than $25,000: One-time $100 fee for filing a
lien on borrower’s business assets plus costs to file lien on real
estate when applicable
For loans greater than $500,000 where SBA is taking real
estate as collateral: One-time $100 fee for filing a lien on
borrower’s business assets. Additionally, the borrower will be
responsible for recording the real estate lien and paying the
associated fees.
Collateral Required for loans greater than $25,000
Personal Guaranty Required for loans greater than $200,000
Apply for a Loan Complete your online COVID EIDL application
Apply for an Increase Complete your request for an increase in your COVID EIDL
portal
What is a COVID EIDL loan?
COVID EIDL loans are distinct and different from regular Disaster Loan Program loans. “COVID
EIDL” stands for COVID-19 Economic Injury Disaster Loan. In response to the COVID-19
pandemic, SBA was given the authority to make low-interest fixed-rate long-term COVID EIDL
loans to help small businesses and other entities overcome the effects of the pandemic by
providing borrowers with working capital to meet ordinary and necessary operating
expenses.
The program ends December 31, 2021 or when funds are exhausted, whichever occurs
sooner.
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What is a Targeted EIDL Advance and Supplemental Targeted Advance?
A COVID EIDL loan is a loan that must be repaid. However, the COVID EIDL program also offers
two types of “advances” that do not have to be repaid. Information on the eligibility
requirements and availability of these advances and links to applications are available on
SBA’s website.
Eligible applicants must be located in SBA-specified low-income communities and must have
suffered reductions of revenue. Note: Agricultural enterprises are not eligible for Targeted
EIDL Advances or Supplemental Targeted Advances.
For more information, see Targeted EIDL Advance and Supplemental Targeted Advance
(sba.gov).
Search by address to see if your business or other eligible entity type is located in an eligible
low-income community.
Targeted EIDL Advance: If you are located in a low-income community, have 300 or fewer
employees, and suffered greater than 30% reduction in revenue, you may be eligible for up to
$10,000.
Supplemental Targeted Advance: If you are located in a low-income community, have 10 or
fewer employees, and suffered greater than 50% reduction in in revenue, you may be eligible
for an additional $5,000 Supplemental Targeted Advance, for a total of $15,000 in Advances.
Section 2: Submitting a New COVID EIDL Application
How do I apply?
Complete your online COVID EIDL application. The online application portal will provide step
by step help. SBA will contact you if additional information is needed. Note: See instructions
for requesting a loan increase.
Note: SBA will begin approving loans greater than $500,000 on October 8, 2021.
What can I use the loan proceeds for?
Borrowers may use COVID EIDL working capital loan proceeds to make regular payments for
operating expenses and to:
• Pay or pre-pay business non-federal debt incurred at any time (past or future),
including monthly payments, payments of deferred interest;
• Pay regularly scheduled payments on federal debt;
• Payroll;
• Rent/mortgage;
• Utilities; and
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• Other ordinary business expenses.
Note: Borrowers with existing COVID EIDL loans are able to use any available loan proceeds
on these authorized uses of proceeds
You may not use the funds to:
o Expand your business;
o Make prepayments on debt that is owned by a federal agency (including SBA) or an
SBIC.
o Start a new business
What are the loan terms?
Loan or Grant: A COVID EIDL loan is a loan that must be repaid. Unlike the Paycheck
Protection Program, a COVID EIDL loan is not forgivable.
Interest Rate and Term:
Businesses: 3.75% fixed for 30 years
Private nonprofit organizations: 2.75% fixed for 30 years
Payment Deferral: The loan term is 30 years; payments are deferred for 24 months (during
which interest will accrue) from the date of first disbursement of the Applicant’s original
COVID EIDL loan. Monthly payments of principal and interest will begin at the end of the
deferment period and will be paid over the remaining 28 years. You may make prepayments
at any time without penalty.
Collateral Requirements by Loan Amount:
$0 - $25,000: No collateral required
$25,001 – $500,000: Security agreement (UCC-1) lien required on business assets - A UCC
filing is a legal notice that SBA will file with the Secretary of State to record a security
interest against your business assets. SBA will charge a one-time $100 fee for filing the
UCC-1 lien.
$500,001 - $2,000,000: Security agreement (UCC-1) lien required on business assets and
a best available mortgage on real estate owned by the applicant business. SBA will
charge a one-time $100 fee for filing the UCC-1 lien. Additionally, the borrower will be
responsible for recording the real estate lien and paying the associated fees.
Personal Guaranty:
$0 - $200,000: No personal guaranty required
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$200,001 - $2,000,000: Except for nonprofit organizations and loans to ESOPs, all loans
require a full personal guaranty from:
• All individuals or entities owning 20% or more of the applicant business;
• For sole proprietorships, the proprietor;
• For independent contractors, the contractor;
• For General Partnerships, all general partners;
• For Limited Partnerships, all general partners and any limited partner who owns 20
percent or more of the partnership;
• For Limited Liability Entities, the Managing Member and any member who owns 20
percent or more of the entity;
• For Corporations, any individual or legal entity who owns 20 percent or more of the
voting stock.
If no single owner owns 20% or more, then at least one individual or entity must provide
a full guaranty.
A personal guaranty is an agreement that an individual makes to assume responsibility
for payment of a loan in the event that the applicant business (“borrower”) fails to repay
the loan in accordance with the loan agreement or note. The person who signs the
guaranty is the guarantor. The personal guaranty remains in place until the loan is paid
in full. (See SOP 50 52 for information on substitution of guarantor. Send substitution
requests to PDC.AccountsCollateralReview@sba.gov.)
Individuals required to sign personal guaranties must sign an Unconditional Personal
Guaranty, which is provided as part of the loan closing documents through the
application portal. Unconditional Personal Guaranties must be signed by all required
parties and returned to the SBA before the COVID EIDL loan funds will be disbursed.
Personal guaranties are not a substitute for any collateral required by SBA. If SBA
requires a personal guaranty, refusal to provide the guaranty is a basis for declining an
application.
No personal guaranty is required for nonprofit organizations or Employee Stock
Ownership Plans (ESOPs).
Underwriting:
Loans $500,000 or less:
• For profit businesses: Minimum credit score of 570 is required
• Repayment ability of for-profit businesses will be determined by the owner’s credit
score
Loans greater than $500,000:
• For profit businesses: Minimum credit score of 625 is required
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• For loans greater than $500,000, SBA will underwrite your loan and provide you
with an opportunity to choose your loan amount, which must be equal to or less
than the maximum eligible loan amount calculated by SBA. As part of its
underwriting, SBA will perform a cash flow analysis for your business to confirm
your business’s ability to repay the proposed COVID EIDL loan as well as your
business’s existing debt obligations.
Am I eligible?
Applicants must be physically located in the United States or designated territory and must
have suffered working capital losses due to the Coronavirus pandemic. The COVID EIDL
application contains specific eligibility screening questions. A sample application is provided
for reference.
Immigration Status:
For-profit businesses other than sole proprietorships: The business must have a valid IRS-
issued tax identification number (TIN). Each owner, member, partner, or shareholders of 20%
or more of the business must be a U.S. citizen, non-citizen national, or qualified alien with a
valid Social Security Number.
Sole proprietorships: U.S. citizens, non-citizen nationals, and qualified aliens with a valid
Social Security Number are eligible for COVID EIDL loans.
For more information on immigration status requirements, see SOP 50 30 9, Appendix 7.
Lawful presence in the United States, alone, is not sufficient to establish that the individual is
a qualified alien.
Eligibility Based on Size:
In addition to other eligibility requirements, businesses must meet SBA COVID EIDL size
standards. You meet COVID EIDL size requirements if any of the following applies to you.
You are:
• A business that, together with affiliates, has not more than 500 employees;
• An agricultural enterprise that, together with affiliates, has not more than 500
employees;
• An individual who operates as a sole proprietorship, with or without employees, or as
an independent contractor and, together with affiliates, has not more than 500
employees;
• A cooperative that, together with affiliates, has not more than 500 employees;
• A tribal small business concern, as described in 15 U.S.C. 657 a(b)(2)(C), with not more
than 500 employees;
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• A business, including an agricultural cooperative, aquaculture enterprise, nursery, or
producer cooperative (but excluding all other agricultural enterprises), with more than
500 employees that is small under SBA Size Standards;
• A private nonprofit organization that is a non-governmental agency or entity that
currently has an effective ruling letter from the IRS granting tax exemption under
sections 501(c), (d), or (e) of the Internal Revenue Code of 1954, or satisfactory
evidence from the State that the non-revenue producing organization or entity is a
nonprofit one organized or doing business under State law, or a faith-based
organization;
• A business that, together with affiliates, has more than 500 employees and:
o is assigned a NAICS code beginning with:
61 Educational Services;
71 Arts, Entertainment and Recreation;
72 Accommodation and Food Services;
213 Support Activities for Mining; Industry group;
3121 Beverage manufacturers;
315 Apparel Manufacturing;
448 Clothing and Clothing Accessories Stores;
451 Sporting Good, Hobby, Book and Music Stores;
481 Air Transportation;
485 Transit and Ground Passenger Transportation;
487 Scenic and Sightseeing Transportation;
511 Publishing Industries (except Internet);
512 Motion Picture and Sound Recording Industries;
515 Broadcasting (except Internet);
532 Rental and Leasing Services; and
812 Personal and Laundry Services.
(You can determine what NAICS code corresponds with your business.);
o employs not more than 500 employees per physical location; and
o has no more than 20 locations (this includes the number of locations that your
affiliates have, if any).
Ineligible entities:
• Those that were not in operation on or before January 31, 2020 (“In operation”
includes businesses that were in an organizing stage but had not yet opened for
business. Evidence that you were in an organizing stage includes, but is not limited to
business licenses, contractual agreements, purchase orders for machinery and
equipment, advertisements, and employment classified ads)
• Those that do not meet program size standards
• Engaged in any illegal activities at the federal, state or local level (including sale of
marijuana/cannabis)
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• Loan packagers that earn more than 1/3 of gross annual revenue from packaging SBA
loans
• Earn more than 1/3 of annual gross revenue from gambling
• Engaged in multi-level sales distribution, lending, investment, or real estate
development or investment (other than rental properties)
• Primarily engaged in political or lobbying activities
• Applicant is a pawn shop that derived more than 50% of the previous year’s income
from interest
• Applicant is a life insurance company
• Publicly owned nonprofit organizations other than tribal business concerns
• Owned by a member of Congress
• Presents live performances of a prurient sexual nature or derives income from the sale
of related products or services
• An entity where any owner of 50% or more of the entity is more than 60 days
delinquent on child support obligations
• Applicant or any 20% or more owners currently suspended or debarred from
contracting with the Federal government or receiving Federal grants or loans
• Any 20% or more owner of the applicant currently incarcerated
• Any 20% or more owner of the applicant presently subject to an indictment, criminal
information, arraignment, or other means by which formal criminal charges are
brought in any jurisdiction for any felony
• Any 20% or more owner of the applicant, within the last 5 years, for any felony
involving fraud, bribery, embezzlement, or a false statement in a loan application or
an application for federal financial assistance, has 1) been convicted; 2) pleaded
guilty; 3) pleaded nolo contendere; or 4) commenced any form of parole or probation
(including probation before judgment)?
• Any 20% or more owner of the applicant, in the past year, has been convicted of a
felony committed during and in connection with a riot or civil disorder or other
declared disaster
• Bankruptcy: See “What is the impact of bankruptcy on eligibility?” below
• Applicant is a business that operates as a franchise and is not listed on SBA’s Franchise
Directory
• Applicant business received revenue or rental income in 2019 and did not file a 2019
federal tax return
How do I know if I have affiliates?
For COVID EIDL loans, an affiliated business (or “affiliate”) is any business in which an
applicant business:
• Owns at least 50 percent; or
• Has a right to profit distributions of at least 50 percent; or
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• Has the contractual authority to control the direction of the business. The affiliation
will be determined as of any agreements in existence as of January 31, 2020.
What is the impact of bankruptcy on eligibility?
If the Applicant business (or the owner, if the business is a sole proprietor or an
independent contractor) is currently in bankruptcy:
• The Applicant business is eligible if it is operating under an approved plan of
reorganization under either a Chapter 5, Chapter 11, Chapter 12 or Chapter 13
bankruptcy. In order to receive COVID EIDL funds, Applicant must provide SBA with
evidence of approval for the loan by the court/trustee for the bankruptcy case.
• The Applicant business is NOT eligible if it:
o Filed for either a Chapter 5, Chapter 11, Chapter 12 or Chapter 13 bankruptcy
but no plan of reorganization has been approved
o Filed for a Chapter 7 bankruptcy, is undergoing a liquidating Chapter 11,
and/or is permanently closed (Applicant is not eligible)
What documents do I need to complete my application?
If you were “in operation” before Jan. 1, 2020:
2019 Federal Income Taxes, including all schedules, for the applicant business (required)
2020 Federal Income Taxes, including all schedules, for the applicant business (if available)
If the most recent Federal income tax return has not been filed, a year-end profit-and-loss
statement and balance sheet for that tax year
For nonprofit organizations, a complete copy of the organization's IRS tax-exempt
certifications and complete copies of the three most recent years of "Statement of Activities"
IRS Form 4506-T (You will complete this online when you apply)
After loan approval and before loan closing: If your business is not a sole proprietorship, you
will be required to provide a Board resolution or certificate of authority providing authority to
commit the business to the COVID EIDL loan. You may use your own Board resolution or ODA
Form P-022 –Resolution and Certification Form.
If you started being “in operation” on or between Jan. 1, 2020 and Jan. 31, 2020:
2020 Federal Income Taxes, including all schedules, for the applicant business (if available)
If 2020 Federal Income Taxes for the applicant business are not available, you must submit
internally or externally prepared business financial statements including balance sheet and
profit and loss statement.
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For nonprofit organizations, a complete copy of the organization's IRS tax-exempt
certifications and complete copies of the years of "Statement of Activities" since inception
After loan approval and before loan closing: If your business is not a sole proprietorship, you
will be required to provide a Board resolution or certificate of authority providing authority to
commit the business to the COVID EIDL loan. You may use your own Board resolution or ODA
Form P-022 –Resolution and Certification Form.
Additional information that must be submitted for loans greater than $500,000:
• SBA Form 2202 – Schedule of Liabilities
• List of Real Estate Owned
• SBA Form 413 – Personal Financial Statement for general partners, managing
members, and all owners of 20% or more of the applicant business (Not required for
nonprofit organizations)
Additional information that may be requested after you submit your application:
• Copy of government-issued photo identification of each principal owning 20 percent
or more of the applicant business
• Current year-to-date profit-and-loss statement
• For loans less than or equal to $500,000: Schedule of Liabilities listing all fixed debts
(SBA Form 2202 may be used)
What if I changed my business form of organization after I filed my 2019 taxes?
If you were in operation on or before January 31, 2020 and subsequently changed your legal
organization (e.g., you were a sole proprietorship and then you incorporated your business),
you must use the tax identification number and address that you used on your 2019 business
federal tax return.
SBA will check the financial information you provide in your application against the 2019 tax
returns that you filed with the IRS. This is the purpose for having you complete the IRS Form
4506-T with your application. The IRS will not provide a verification if the data on your taxes
does not match your COVID EIDL application. SBA will not approve your application without
this IRS verification.
I’m not a U.S. Citizen but my business meets all other criteria for COVID EIDL. Am I
eligible?
All owners, members, partners, or shareholders of 20% or more of the business must be:
• US citizen with Social Security Number (SSN); or
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• Non-US citizen who resides in the U.S. and is classified as a “non-citizen national” or
“qualified alien” with SSN. Qualified aliens include permanent residents with a current
green card
By when must my business have been in operation in order to be eligible??
You must be able to prove your business was in operation on or before January 31, 2020. You
may be asked to provide this documentation to prove your business was in operation on or
prior to Jan. 31, 2020.
I purchased my business after January 31, 2020. Am I eligible?
Businesses that had more than a 50 percent change of ownership after January 31, 2020 are
ineligible unless the change in ownership involved a close family member or partner or the
contract for sale existed prior to January 31, 2020.
Should I submit separate applications if I have more than one business or
location?
The way you apply is determined by how you file your federal taxes. For example:
• If you operate three locations but report all sales in one federal tax return, you should
complete one application for all of your locations;
• If you operate three locations and file a separate federal tax return for each location,
you should complete a separate application for each location;
• If you are a sole proprietor with multiple businesses:
o If you report your business’s revenues on a single Schedule C, you should complete
one application;
o If each of your businesses has its own tax identification number and you file
separate Schedules C, you should complete a separate application for each
business
How much can I borrow?
For loans up to $500,000, your maximum eligible loan amount is determined by a formula
based on the date you began operations. You will have the opportunity to choose your loan
amount, which must be equal to or less than the maximum eligible loan amount calculated
by SBA.
If you were in operation before January 1, 2019, your maximum eligible loan amount is
calculated as follows: 2019 gross receipts or sales minus 2019 costs of goods sold multiplied
by 2, or $500,000, whichever is less.
For applicants that began operations partially through 2019 or 2020, SBA will calculate your
maximum eligible loan amount.
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For applicants using rental loss, SBA will calculate your maximum eligible loan amount.
For loans greater than $500,000, SBA will underwrite your loan. As part of its underwriting,
SBA will perform a cash flow analysis for your business to confirm your business’s ability to
repay the proposed COVID EIDL loan as well as your business’s existing debt obligations.
What lines from my tax return should I use for gross receipts, costs of goods sold,
or costs of operation?
The lines used for gross receipts, costs of goods sold, and expenses vary by the entity tax
return type.
LLCs should follow the instructions that apply to their tax filing status in the reference
periods.)
Gross Costs of
Entity Type IRS Form Receipts Goods Sold Costs of Operation
Self-employed 1040 Schedule C Line 1 Line 4 N/A
Self-employed 1040 Schedule F Line 9 N/A Line 33
S-Corporation 1120-S Line 1a Line 2 N/A
C-Corporation 1120 Line 1a Line 2 N/A
Cooperatives 11201-C Line 1a Line 2 N/A
Partnerships 1065 Line 1a Line 2 N/A
Privately owned 990 Line 12 N/A Line 18
nonprofit org
Privately owned 990-EZ Line 9 N/A Line 17
nonprofit org
Is there a limit to how much a corporate group can borrow?
Businesses that are part of a corporate group may not receive more than $10,000,000 in
COVID EIDL loans in the aggregate.
Your business is part of a single corporate group if:
• You or your business has majority ownership, directly or indirectly in any other
business that has a different tax identification from your business
• Your business is majority owned, directly or indirectly, by a parent company that has a
different tax identification number from yours.
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Who can sign the application?
The application and other legal documents (such as the note and the loan authorization
agreement) that require the applicant’s signature must be signed by an individual authorized
by the business to do so. Typically, this is the owner of the business, the CEO, or CFO.
I have a business partner, but he/she does not want to be included on the COVID
EIDL application. Can I still apply?
Information on all owners who own 20 percent or more of the business is required to be
included on the application, and at least 81 percent of the ownership must be accounted for
on the application.
For loans greater than $200,000, all owners who own 20 percent or more of the business, and
any managing member or general partner, will be required to sign a personal guaranty.
Is it okay to submit another application if I haven’t heard from SBA?
No. Do not submit more than one application, as this will delay SBA’s review of your
application.
What is the deadline to file an application?
The last day that applications may be approved is December 31, 2021. Be sure to file your
application as soon as possible to allow processing time for approval.
How do I get help with my loan application?
Contact SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard
of hearing) or DisasterCustomerService@sba.gov.
And, your local SBA District Office and resource partners such as local Small Business
Development Centers (SBDC), Women’s Business Development Centers (WBC), SCORE offices,
or Veteran Business Outreach Centers (VBOC) will help at no cost. Find your local SBA office .
Section 3: Submitting a COVID EIDL Increase Application
Can I apply for additional loan funds if I already received a COVID EIDL loan?
Yes, you can apply for an increase up to the amount you qualify for or the $2,000,000 cap,
whichever is lower. Due to the “Exclusivity Period,” SBA will begin approving loans greater
than $500,000 on Oct. 8, 2021.
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How do I request an increase to my loan?
Complete your request for an increase online by logging into your account in the COVID EIDL
portal. Do NOT apply for another loan or your application may be flagged as a fraudulent
application.
The deferment period for any loan increase will be 24 months from the date the COVID EIDL
loan was first disbursed (not the date of increase). If you received a loan in 2020 or 2021 that
does not have a 24-month deferment period, SBA will reset your deferment period to 24
months from the date your loan was first disbursed to you.
The amount of loan increase that you are eligible for is determined by the loan amount that
you would be eligible for if you applied today minus the loan (including any increases) that
you have already received. You may apply for an additional increase even if you have already
applied for and received previous loan increase.
For example, if you are eligible for a $700,000 COVID EIDL loan today, but your current COVID
EIDL loan is $500,000 (either because your maximum loan amount was capped in the past or
because you elected to take less than the full amount), you are eligible to request an increase
of $200,000.
Collateral and fees:
• For loans greater than $25,000 (including your original loan amount plus the amount
of your loan increase), if SBA does not already have a UCC-1 lien on the business
assets, SBA will charge a one-time $100 fee for filing a UCC-1 lien.
• For loans greater than $500,000 (including your original loan amount plus the amount
of your loan increase):
o If SBA does not already have a UCC-1 lien on the business assets, SBA will charge a
one-time $100 fee for filing a UCC-1 lien;
o If SBA does not already have a lien on business real estate, SBA will require a best
available mortgage on real estate owned by the applicant business. Additionally,
the borrower will be responsible for recording the real estate lien and paying the
associated fees.
Personal Guaranty: Required for loans greater than $200,000 (which includes your original
loan amount plus the amount of your loan increase). See “Personal Guaranty” in Section 2
above for more information.
SBA will contact you if additional information is needed.
How do I get help with my loan increase?
Contact SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard
of hearing) or DisasterCustomerService@sba.gov.
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Section 4: Application Status and SBA Decision
How do I check the status of my application?
You can check the status of your application any time by logging into your account in the SBA
portal.
What can I do to decrease the processing time of my application?
You can reduce the total time it takes for your application to be reviewed by responding
quickly to any SBA requests for applicant information, signatures, and approvals. This allows
the review team to move your application through each processing step faster.
If my COVID EIDL application was declined, is it possible for me to correct any
errors and to re-apply?
Yes, this can be done via the reconsideration process outlined in your decline letter.
How will SBA communicate with me?
An SBA loan officer may contact you by telephone or email if additional information is
required to process your loan application. Do not send any personally identifiable
information, such as your Social Security Number or Federal Tax Returns to any email
address that does not end with @sba.gov. You may be invited to upload specific documents
via the application portal. SBA will always send emails from an address that ends with
@sba.gov. If your application is approved, you will receive an email with instructions.
What can I do if my application is declined?
You will receive an email explaining why the application was declined, including instructions
on how to request reconsideration.
Send reconsideration requests to PDCrecons@sba.gov.
Include your application number, any information required to overcome the reason for
decline, and any additional information that may assist us in processing your request.
If the decline letter requested specific information or documentation for reconsideration, you
must include those items. Be sure to include:
• Business Name (both the legal name and DBA if applicable)
• Borrower’s Name
• Business Federal Tax Id: EIN, SSN, or ITIN
• Application/Loan Number
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You can request reconsideration in writing; however, the last day that applications or
reconsiderations may be approved is December 31, 2021. Be sure to file your request for
reconsideration as soon as possible to allow processing time for approval.
If you do not respond within 7 days to a request for additional information from SBA, your
application may be declined. You may request a reconsideration to reactivate your
application.
What are the most common reasons for decline?
The most common reasons for a decline include:
• Unsatisfactory credit history - Credit score does not meet minimum credit score
requirement. You may request reconsideration to reactivate your application and
submit additional financial information to demonstrate repayment ability.
• Unverifiable information - During the review process there were one or more items
that were reviewed that caused the SBA to question the validity of certain information
in the application. This can occur as a result of a failed identity verification,
international IP address, client device associated with fraud, or high-risk IP address.
You may request a reconsideration to reactivate your application and submit
additional information.
• SBA was unable to approve the application because the business, together with its
affiliates, has reached the $2M limit. You may request reconsideration to reactivate
your application if you believe that assessment may have been in error.
• Ineligible non-US citizen status - Owners of 20% or more of the applicant business
must be US citizens, non-citizen nationals, legal permanent resident, or certain
asylees. If you believe this determination was made in error you may request
reconsideration to reactivate your application and submit additional information to
substantiate owner citizen, non-citizen national, or qualified alien status.
• Business activity not eligible - The information you submitted with your application
does not meet SBA regulations for an eligible business activity as described in Section
2 above.
• Failure to respond. If you do not respond to the request for additional information
within 7 days, the application will be withdrawn with a status of borrower did not wish
to proceed. You may request a reconsideration to reactivate an application within a
reasonable period of time pending funds available.
How do I securely upload documents to SBA?
You can contact SBA by phone at 800-659-2955 or by email at PDCrecons@sba.gov to request
a secure mode of uploading documents.
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Section 5: Post-Disbursement of Approved COVID EIDL Loan Funds
How will I get my money?
When your application is approved, SBA will provide you with loan documents that must be
completed and signed. Be sure to keep a copy for your records.
For loans where SBA is not filing a lien on real estate, loan proceeds are electronically
deposited to your bank account within 5-10 business days of the time that SBA receives your
completed loan documents. For loans greater than $500,000 where SBA requires a lien on real
estate, proof of recorded mortgage/deed of trust and flood insurance, if applicable, will be
required prior to disbursement of loan proceeds.
How do I make payments on my loan?
Payments are deferred for the first 2 years (during which interest will accrue), and payments
of principal and interest are made over the remaining 28 years. You may make prepayments
at any time without penalty. SBA will send you a monthly bill beginning the month before the
first payment is due.
Without any action on the part of the borrower, SBA will extend the deferment period of all
COVID EIDL loans to 24 months if they do not already have a 24-month deferment period. For
borrowers that receive a loan increase, the deferment period begins on the date of the
disbursement of the original loan.
You may set up online payments by completing an SBA Form 1201 Borrower Payment on
Pay.gov.
Or mail payments to:
U.S. Small Business Administration
P.O. Box 3918
Portland, OR 97208-3918
When mailing payments, include:
• Business Name
• Borrower’s Name
• Borrower’s Address
• Account Number
• Tax ID/EIN or SSN
• 10-digit SBA Loan Number
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Who do I contact after my loan is closed if I need help?
Contact SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard
of hearing) or DisasterCustomerService@sba.gov.
What do I do if my loan application was approved, but I’m experiencing a
significant delay in receiving the funds?
It’s possible there is an error with the bank account information you submitted. Contact
SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard of
hearing) or DisasterCustomerService@sba.gov for assistance.
What are my record keeping requirements?
You must retain tax returns and financial records for all loan funds spent for 3 years.
If I’ve already received a COVID EIDL loan and I’ve been affected by another
disaster such as a flood, can I ask for more funds?
If you are in an area that has a Disaster Declaration, which includes disasters such as flooding,
storm damage, wildfires, or earthquakes, you may be eligible for additional SBA disaster
loans to cover damage to your home, personal possessions and/or business. Check
DisasterLoanAssistance.sba.gov to see if there is a disaster declaration for your area.
If I get another SBA disaster loan due to different disaster event, can I consolidate
the new loan with my COVID EIDL loan? Or can I use it to pay off the COVID EIDL
loan?
No. Each SBA disaster loan is a separate loan. They cannot be consolidated. If you qualify for
another SBA disaster loan due to a different declared disaster in your area, the new loan must
be used for the purposes listed in your loan closing documents, which may include working
capital or physical damage repairs. The terms and conditions of other disaster loans may be
different than those of the COVID EIDL loan.
Can I sell my business after I receive the COVID EIDL loan?
It’s possible for someone to assume your COVID EIDL loan. There are also circumstances
where you would be required to repay the loan in full upon sale of your business. Please see
SBA SOP 50 52 for more information.
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Section 6: Fraud, Waste, and Abuse
How do I report fraud, waste, or abuse?
Contact the Office of Inspector General to file an online complaint:
Online Complaint Submission System
What if somebody stole my identity to apply for and obtain EIDL assistance in my
name?
If you suspect that someone used your personal information without your knowledge or
permission to obtain SBA COVID EIDL loan assistance, please download this EIDL identity
theft letter for step-by-step instructions on how to report the identity theft case to 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.
How do I remove the hard inquiry from my credit report as a result of identity
theft?
You can dispute a hard inquiry and request that it be removed as a result of identity theft by
contacting Experian directly at 1-800-888-397-3742 or online at Experian Disputes.
Why am I still receiving monthly statements after I reported the identity theft to
SBA?
You may continue to receive monthly statements while SBA is working to review your identity
theft documents and to address the open loan debt. The statements do not reflect the status
of the ongoing review of the identity theft. SBA will send you a separate written confirmation
when the identity theft review is completed, and the loan debt has been resolved.
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