Frequently Asked Questions About Applying for SBA Disaster Loans (EIDL) Due to Coronavirus

Frequently Asked Questions About Applying for SBA Disaster Loans (EIDL) Due to Coronavirus

Frequently Asked Questions About Applying for SBA Disaster Loans (EIDL) Due to Coronavirus

This article has been updated April 23, 2020 to include additional funding approved by Congress.

Small business owners impacted by the coronavirus crisis may want to consider an SBA Economic Injury Disaster Loan (EIDL). These loans are attractive for several reasons, including:

  • Low fixed interest rates: 3.75% or 2.75% for non-profits
  • Long-term repayment of up to 30 years
  • No prepayment penalties
  • Payments deferred (interest accrues)

Here are answers to some common questions from small business owners about Economic Injury Disaster Loans (EIDLs). Note, we have gathered this information from a variety of SBA sources and strive to provide helpful guidance, but do not rely on this as definitive answers to your questions. 

Warning: If you already applied for a disaster loan before March 28, 2020, you need to monitor your credit asap.

On April 23, 2020, Congress approved an additional $50 billion for EIDL loans and $10 billion for EIDL grants. It is unclear, however, whether the SBA will reopen the application portal for new EIDL applications or will simply process existing applications. We will update this article as additional information becomes available. 

In addition, Congress approved $310 billion in funding for Paycheck Protection Program (PPP) loans. This article discusses EIDL loans which you obtain from the SBA. However, you may also want to apply for PPP

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If you have questions about your individual situation or application, we recommend you call SBA Disaster Assistance at 1-800-659-2955. The call center is currently open Monday–Sunday, 8a.m. – 8p.m. ET. Resource partners such as SBDCs, SCORE and Women’s Business Centers can help as well. 

In addition to the Economic Injury Disaster Loan, we encourage you to check out other resources including:

Warning: If you already applied for a disaster loan before March 28, 2020, you need to monitor your credit asap.

Who Are These Loans For?

  • You must be a small business, cooperative, ESOP or tribal business with 500 or fewer employees;
  • A small business that meets SBA size standards;
  • An individual who operates under as a sole proprietorship, with or without employees, or as an independent contractor; or
  • A private non-profit or small agricultural cooperative.
  • Your business must be directly affected by COVID-19

Are They Available In My State? 

All states and US territories are now eligible to apply. 

How Much Can I Ask For? 

The maximum loan amount is $2 million. Note that you will not ask for a specific loan amount on the application. The SBA will determine the loan amount for which you qualify based on the information on your application.

How Does the SBA Decide How Much I Get? 

The SBA will calculate economic injury according to a couple of different formulas spelled out in Disaster Loan Standard Operating Procedures. According to the SBA, “economic injury” is defined as: 

[A] change in the financial condition of a small business concern, small agricultural cooperative, small aquaculture enterprise, or PNP of any size (excluding religious organizations) attributable to the effect of a specific disaster, resulting in the inability of the concern to meet its obligations as they mature, or to pay ordinary and necessary operating expenses. Economic injury may be reduced working capital, increased expenses,  cash shortage due to frozen inventory or receivables, accelerated debt, etc.

How Do I Get the $10,000 Grant?

The Economic Injury Disaster Loan includes an emergency grant of up to $10,000 to be made within three days of application.  It is currently based on $1,000 per employee. Although the CARES Act indicated these grants should be made within three days of application, initial grants have taken more than a couple of weeks to be processed. The current online form includes a request for your bank account information to deposit funds. 

These grants may be used for: 

  • providing paid sick leave to employees unable to work due to the direct effect of the COVID–19; 
  • maintaining payroll to retain employees during business disruptions or substantial slowdowns;   
  • meeting increased costs to obtain materials unavailable from the applicant’s original source due to interrupted supply chains; 
  • making rent or mortgage payments; and 
  • repaying obligations that cannot be met due to revenue losses. 

These grants do not have to be repaid.  And although the IRS has not yet issued guidance, it appears that these grants are not taxable. (Be sure to check with your tax professional.)

If you get a loan under the Paycheck Protection Program (PPP) and are eligible for loan forgiveness, this grant will reduce the amount eligible for forgiveness.

See How Much SBA Loan Money You Qualify For

See How Much SBA Loan Money You Qualify For

Use our CARES Act SBA loan calculator to see how much money your business may qualify to get.

Use the Calculator

How Long Do I Have to Be in Business?

The time in business requirement has been waived. However the business must be in operation by the date of the declared disaster. For COVID-19-related claims that means before January 31, 2020.

Do I Have to Have Employees?

No. Business owners without employees may be eligible. 

Are Home-based Businesses Eligible to Apply?

Yes. Being a home-based business does not disqualify you. However you must list a US address on your application. If you normally use a PO Box for business correspondence, make sure to list your physical home address. 

How Can I Use the Money? 

These working capital loans may be used to pay fixed debts, payroll, accounts payable, and other bills that could have been paid had the disaster not occurred. The loans are not intended to replace lost sales or profits or for expansion. Funds cannot be used to pay down long-term debt.

Can I Use This to Consolidate Debt? 

These loans cannot be used to refinance long term debt. 

What If I Just Want the Grant?

You do not have to accept the loan. You can accept the grant and decline the loan.

If I Have Access to a Line of Credit Elsewhere Can I Apply?

Yes you can still apply. You can use that funding while you wait for disaster assistance. In fact, if you have access to another source of borrowed capital to bridge the gap between your application with the SBA and when funds are dispersed, we would recommend that.

What Is the Credit Score Requirement?

There is no minimum credit score required, however, applicants must have a credit history acceptable to SBA. 

What If I Don’t Have Great Credit Scores? 

If you have damaged credit, apply and include an explanation with your application. Guidelines for those who process SBA Disaster Loan applications state: 

“For disaster lending purposes, satisfactory credit history is defined as a history that generally shows payments to creditors as agreed unless otherwise justified… 

Generally, a history that consists of minor, isolated instances of adverse credit or late payments is acceptable. Major instances of adverse credit such as unpaid judgments, repossessions, previous foreclosures, charge-offs, and unpaid collections can be overcome provided: 

  1. The applicant explains the lapse; and 
  2. The applicant has other accounts with “as agreed” payment records. 

For purposes of evaluating adverse information found on an applicant’s (credit reports), the information should be considered within the totality of circumstances; for example, financial difficulties caused by one-time situations such as divorce, job loss, serious medical illness, etc.

For purposes of disaster lending, medical collections are not considered adverse information.

Non-medical collections or charged off accounts with an aggregate of $10,000 or less and foreclosures or deed-in lieu of foreclosures which occurred more than two years from the date of the loan application are all considered an acceptable credit risk and do not require any additional justification.”

However, SBA Standard Operating Procedures also state that loans cannot be recommended for approval if the credit history is unsatisfactory so there is no guarantee that it won’t result in a denial. 

What If I Have Been Through Bankruptcy?

Prior bankruptcy is not an automatic reason for denial. A previous Chapter 7 bankruptcy may be acceptable, especially if it is older, but even recent bankruptcy (within the past two years) may be acceptable if it was due to circumstances beyond the applicant’s control and he or she has maintained a positive credit history since.

Applicants currently in Chapter 11 bankruptcy may be eligible if payment history is satisfactory, though written permission from the Bankruptcy Trustee will have to be obtained. Businesses in Chapter 11 bankruptcy may or may not be eligible; it may still be worthwhile to apply.  

Will My Business Credit Be Checked? 

The SBA requires a business credit check from Dun & Bradstreet or a similar commercial credit agency for approved loan amounts of $200,000 or more, unless your business is a sole proprietorship.

Tip: You can check your business credit with a free Nav account. Doing so will not affect your credit scores.

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Pull back the curtain on your business credit

Ready to see your credit data and build stronger business credit? Check your personal and business credit for free.

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What Credit Problems Will Disqualify Me? 

In addition to the guidelines above you may not qualify if:

  • You are more than sixty (60) days delinquent on child support obligations. 
  • You have judgements against you for federal debts and you have not worked out a satisfactory repayment plan. 
  • You have federal tax liens of more than $10,000. (You may still qualify but you must provide a satisfactory explanation and be able to repay the tax debt. It’s recommended you work out a payment plan with the IRS as soon as possible.) 

What Do I Do If My Credit Is Frozen?

It’s recommended that you lift a credit freeze before you apply. For these loans, it appears personal credit checks go through Experian. Make sure you have alerts set up to detect any new activity on your credit reports so you can freeze your files again once your credit has been checked. 

How Fast Can I Get Funding?

The SBA’s goal is to process completed applications within 21 days but this is an unprecedented disaster of national scope and appears the SBA is taking several weeks to process them. In previous disasters, processing has taken as long as an average of 45 days. 

Will I Get the Full Amount Right Away?

The first disbursement will be for up to $25,000 and there will be later disbursements. 

What If I Shut Down And Don’t Know When I Will Reopen?

You can request additional funds in the future if needed. 

Is There a Deadline to Spend the Funds? 

There is none specified, however, the SBA does state that these loan “proceeds can only be used for working capital necessary to carry the concern until resumption of normal operations and for expenditures necessary to alleviate the specific economic injury.” In other words, they are to be used to help the business recover from the disaster.

Do I Have to Be Turned Down By A Bank First?

No. While you certainly should be looking at all financing options available, including  Paycheck Protection Program loans, you won’t have to supply credit rejection letters in order to apply. The “credit elsewhere” test the SBA normally performs has been waived for these loans. 

Is There A Prepayment Penalty?

No. You can pay off the loan early without a penalty.

Can Landlords With Investment Properties Qualify?

Yes, you may be eligible.

What Documents Do I Need?

The SBA has streamlined the initial online application. However, at some point you may need to supply some of the following information so you may want to familiarize yourself with these forms. You can download each form here: 

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How Can I Get Help With the Application?

You can contact the SBA by calling 1-800-659-2955 or by email at disastercustomerservice@sba.gov. Warning: There may be a long wait time. 

Another great option is to contact your local SBDC, Women’s Business Center or SCORE office for free assistance.

You may also be able to hire a professional to help you, though the SBA emphasizes that you do not have to pay anyone to complete this application. 

Do I Have to Fill Out All Questions?

Make sure you fill out each question that has an asterisk, as those are required. If you can’t get an answer to help you fill out a specific question, just do the best you can. In addition, try to fill out all other questions if you can, as best you can. An incomplete application will likely result in delays. You can provide additional information to explain why you answered a question in a particular way.

Tip: Don’t make the person reviewing your application guess. Feel free to share comments that help them understand your situation, but try to keep them succinct and clear as they are reviewing a lot of applications. 

Is A Personal Guarantee Required?

While SBA loans normally carry a personal guarantee, they have been waived for COVID Disaster Loans, up to $200,000.

Is Collateral Required?

For loans over $25,000, collateral will be required if available. (That can include home equity.) However, the borrower will not be denied solely because there is no collateral. 

What Tax Returns Do I Have To Provide?

Note: The CARES Act signed by the President on March 27, 2020 allows the SBA Administrator to waive the tax return requirement for these loans.

The following is based on information available prior to the enactment of that legislation and may no longer be required. We will update this section when more guidance is available.

If a tax return is still required, you will likely have to submit IRS Form 4506-T “Tax Information Authorization” with the disaster loan application. This allows the SBA to obtain transcripts of Federal income tax returns. Tax returns are required for each principal owning 20% or more of the applicant business, each general partner or managing member, and each affiliate when any owner has more than 50 percent ownership in the affiliate business. Affiliates include business parents, subsidiaries, and/or other businesses with common ownership or management.

Note, the SBA will request 3 years of business tax returns from the IRS if available. 

In addition you should be prepared to provide: 

  • 2019 business tax return if filed or your 2019 year-end profit and loss statement and balance sheet and the most recently filed business tax return 
  • 2020 year-to-date profit and loss statement

What Do I List for the Amount of Physical Damage? 

If you are requesting a disaster loan due to COVID-19 you will not be requesting a loan for physical damage. Make sure you requested the correct type of loan: the COVID-19 Economic Injury Disaster Loan.

What is the FEMA Number?

You do not have to enter a FEMA number for the EIDL. Make sure you are in the right application.

Am I Eligible If I Already Have a Disaster Loan from a Previous Disaster? 

Yes, but there is a total limit of $5 million of SBA assistance. 

What If I Have Two Businesses In Different States?

Fill out an application for each business.

What Happens After I Apply?

Your loan application will be processed by a case manager. They may reach out to you at some point so make sure you provide a phone number you will answer and an email address you check regularly

You will get an application number on your computer screen after you successfully complete your application online. Keep that number in a safe place in case you need to check on the status of your application. Check your spam folder frequently as well.

I Applied Before Funds Ran Out. Do I Apply Again?

If the SBA opens the EIDL application portal again, and your application number started with a “2” you may want to apply again. That’s because you applied before the new system that allowed you to request the grant. If your application number starts with a “3” you should not have to reapply. SBA is processing applications on a first-come, first served basis. 

Business owners in the Nav SBA Cares Act Loan Insights Facebook group are sharing updates on their EIDL applications. You may want to join to learn from their experiences.

When Will I Have to Start Making Payments?

Payments will be deferred for one year. (Interest will accrue.) 

How Do I Check the Status of My EIDL Application?

You cannot check the status of your application online. You can call the SBA Disaster Assistance hotline to confirm receipt of your application but you won’t be able to get a date when your application will be processed however.

Check your email for updates (check your spam folder as well) and monitor your bank account to see if the grant has been deposited.

What If I Get Turned Down?

You have up to six months to request a reconsideration. 

The Bottom Line

This loan application can be confusing. If the application portal opens again, don’t let that stop you from applying. The next round of funding will likely go quickly. Here are two tips:

  1. You can go through the online application to see what information you’ll need before you actually apply. Just don’t submit it. 
  2. You can ask for help. If you have questions, our best advice is that you try to get answers from SBA Disaster Assistance or an SBA resource partner such as your SBDC, Women’s Business Center or SCORE chapter. Many of these offices are hosting webinars, office hours, and other events to help answer questions. If you can’t get a specific answer, apply and just do the best you can.

We will continue to monitor this program and provide updates.

Please keep in mind this information is changing rapidly and is based on our current understanding of the programs. It can and likely will change. Although we will be monitoring and updating this as new information becomes available, please do not rely solely on this for your financial decisions. We encourage you to consult with your lawyers, CPAs and Financial Advisors. To review your real-time funding options with one of Nav’s lending experts, please contact us.

This article was originally written on March 25, 2020 and updated on June 3, 2020.

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ABOUT AUTHOR

Gerri Detweiler

Gerri Detweiler

Education Director for Nav

Credit expert Gerri Detweiler is education director for Nav. She has more than three decades of experience in consumer credit education, has been interviewed in more than 3500 news stories, and answered over 10,000 credit questions online. Her articles have been widely syndicated on sites such as MSN, Forbes, and MarketWatch. She is the author or coauthor of five books, including Finance Your Own Business: Get on the Financing Fast Track. She has testified before Congress on consumer credit legislation.

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124 responses to “Frequently Asked Questions About Applying for SBA Disaster Loans (EIDL) Due to Coronavirus

  1. Hello Gerri,

    Thank you very much for your time writing this great article!
    This should be on SBA website, much better explanation then SBA Q&A!
    I just received an email from SBA to enter a loan amount up to an amount quoted and verified our personal information and status now shows “Your application is being processed”
    I am sure if this means I am fully approved for it or not.

  2. I applied for the SBA EIDL loan. I was just wondering can you receive unemployment benefits and the loan? Thanks

    1. Mellisa – We haven’t seen guidance on that. It seeems that if you’re using EIDL to pay yourself payroll then that would reduce unemployment or make you ineligible, but that’s just my guess not legal advice. EIDL can be used for purposes other than payroll.

  3. We applied for a $2M EIDL loan and given the SBA directive to cap at $150,000, just learned we have approval for a $150,000 loan. There are bills being presented that could provide additional funding for EIDL Loans. If we accept the $150,000 loan, are we eligible for additional funds if congress provides more money for this program?

  4. Can you accept the EIDL if you already receive a City grant and private grant? We got the approval and we just need to sign the docs.

    1. We aren’t aware of EIDL restrictions that would prevent you from accepting the loan because you got the grant but you can always check with the SBA by calling the SBA Disaster Assistance hotline.

  5. Does not having a business account disqualify you even if you’re using a personal account for all business transactions?

  6. Thanks for the information. What if we applied for our non profit, got the grant, got approved for the loan, and then after looking at the documents, realized its just not a good solution for us? do we just not sign the documents and let the two months run out? I don’t see where I can decline the loan. And then what will happen with the grant?

    1. Samantha, I can think of three possible scenarios. Did any apply to you?

      1. You listed 0 employees on your application.
      2. You applied early before the application which allowed you to request the grant was available.
      3. You did not check the box on the newer online application that allowed you to request the grant.

  7. I applied for EIDL loan on 3/30/2020 and I just received 2,000 $ on 04/23/2020. DO I still can get 10,000 EIDL loan as I have 2 employees or this 2,000 $ is all I got. Thank you

  8. Hi
    I sent in my EIDL application on March 30
    And received my closing documents today May 16
    But have not received the $10,000 advance as of yet

    1. Michelle – They changed the grant to $1000 per employee. The grant usually comes before the loan. As I mentioned to Samantha, I can think of three possible scenarios here:

      1. You listed 0 employees on your application.
      2. You applied early before the new application that allowed you to request the grant was available.
      3. You did not check the box on the online application that said you wanted to be considered for the grant.

      I would recommend you contact the SBA Disaster Assistance hotline to find out what happened. Let us know if you can.

  9. I applied SBA Disaster Relief Fund for my business from April 4, 2020. It has been 7 weeks since that day but I don’t see anything FUND. Why do my application take too long? All of my friends have businesses, and they applied for it received after just 3 days or 2 weeks later.

  10. I received from the sba an email approval for the eidl loan at 3.75% interest. Is the EIDL loan forgivable? I have not received anything (info/money) regarding the EID grant? Is the EIDL and EIDG different? What can I do now if I want the EIDG and not the EIDL?

    1. No the loan is not forgivable. I don’t know why you didn’t get the grant. If you see my response to Samantha in the comments I proposed a few possible scenarios. I’d recommend you call the SBA Disaster Assistance hotline and see if you can find out why you didn’t get the grant. Please let us know what you learned!

  11. I submitted an EIDL application on 3/30 and received an email to enter a loan amount up to an amount quoted and verified our personal information. Says processing with an underwriter. Last step is to sign loan docs. Does this mean we’re approved for the loan?

  12. I didn’t receive any grant money but am now signing my EIDL loan paperwork. I’ve already gotten my PPP.

    Does the fact that I will now receive an EIDL loan somehow reduce my PPP forgiveness (assuming I still spend the funds of different categories of expenses)?

    1. You must subtract an EIDL advance from your PPP loan for forgiveness purposes, but that’s not the case with the EIDL loan. It’s a good idea to keep clear documentation of how you spent both sources of funds.

  13. Great article. What happens if I go out of business in 6 months or 3 years ( a very real scenario for me) from now and cannot pay EIDL loan back ? I understand there is no personal gurantee but what is considered collateral ?

    1. Collateral is required (if available) for loans above $25,000. It may include available home equity. If you get a loan offered for above that amount make sure you understand the collateral requirements.

  14. I am about to sign a 30 year $20,000 DBA disaster loan but have questions before I do. I own and operate a children’s Karate school as a DBA business. I was shut down by New York State on March 15th and may not be able to reopen till September. When I do open I will owe the Landlord $8,000 in back rent. What happens if I get the loan and still go out of business????? There is a good chance only few of my students will return. Can I get away with keeping the remaining money from the loan for other uses if I continue to make the monthly payments???????? Will the DBA require proof of how the money is spent?????

  15. I applied for the EIDL and PPP programs in march. The EIDL loan i originally applied on 3/26/20 with paper documents uploaded. I then reapplied on 3/30/020 with the fasttrack application. The fasttrac asked if you have been convicted of a felony in last 7 years, I put no which is true. On the original paperloan application it asked if I had ever been convicted of a felony and I was back in 1996. Does this disqualify me for the EIDL loan? I did get the PPP program and got funded, it states within last 7 years you are disqualified. Why would EIDL loans be different than PPP?

    1. EIDL is under the Disaster Loan program and PPP is under the 7(a) program. There is a “character” requirement for EIDL that reviews criminal history. This article discusses criminal history and EIDL applications. Please let us know what happens in your situation.

  16. We applied for EIDL and PPP. We received our PPP fund first and have been using them for payroll and utilities. We just got confirmation that we will be receiving the EIDL. I want to know if I can use the EIDL loan for payroll when the PPP loan is paid out in 8 weeks?

    Also..EIDL says the principal payment and/or interest are deferred for 1 year but is the interest accrued for that deferred year?

  17. I started an LLC in 2018 and have been under construction of my business with an Sba loan since July of 2019. The pandemic hit right when I was about to open my doors for my business. I have been paying a substantial amount of rent and mortgage interest since last year when construction began and have 2 employees. I have filed tax returns for 2018 and 2019 showing significant losses due to major construction expenses with no income as of yet. I do not have any income yet, as I was not able to open due to the pandemic. Will I still be eligible for the eidl loan without any income shown til date but substantial expenses due every month such as rent, mortgage, and utilities until the reopening occurs in my state?

  18. I received a PPP loan and would like to cancel my EIDL loan request. What about the $1,000 advance I received. I was told that would be subtracted from the amount of forgiveness of my PPP loan. It appears that my PPP request amont was already reduced by this $1,000. How do I cancel my EIDL request? Thank you, AL

    1. If you already got the advance I am not sure there is a way to return it. You’d have to ask SBA that question. But you could subtract it from your PPP for forgiveness and simply pay back that $1000 to your PPP lender. (If you keep it, it’s a 1% loan for two years.)

    2. Hi Gerri
      I only applied for the EIDL grant and received $4,000 for each of the 4 employees we have. I’m at a loss to what loan or assistance to apply for next. Can I apply for the payroll tax credit having received the $4K grant?
      I have a little income coming in and have prioritized paying payroll and buying materials to manufacture our product. Have not paid any state or payroll taxes since they can be deferred and have not paid any long term debt ( credit cards). Thanks

  19. 10,000 showed up in my account, for EIDL, I had no idea I was getting it. How do I know if this is a loan or grant?

  20. The EIDL Is Basically Just A 3.75% Loan Right? How Does That Help Anyone? Seems Like The SBA is Taking Advantage Of A Plague To Make Profit. Am I Correct?

  21. The portal is so confusing. I have a s Corp and a small ranch. I made applications on both and received 1,000 on the ranch application. Is that it? Anything additional? I did receive a reject app on the S Corp even though it was made before the ranch application and there was no message indicating the portal was closed for S corps. When I made the ranch app it said only Ag apps were being accepted. The S Corp app made no such notice. Do I need to reapply for the s Corp app? I sweat in the sun and have essential duties. Live in a rural area with spotty internet. Am I expected to to sit and monitor the sba portal and pray to God that my timing is perfect? The rejection letter does not say if I need to reapply later? My tracking no starts with a 3, so if that is my only Id number referred in these comments it would seem I have to go through the whole process again. Nowhere am I asked for a lender or an amount. Thank you. Michael, drowning in Texas. Final comment … Economic relief is more than payroll.

    1. I’m sorry it’s so difficult for you Michael. I can’t speak for the SBA but if you are the only employee then my guess is you received the advance/grant. You may receive a subsequent email about the loan but for most businesses it is taking several weeks at least to hear back on the loan.

      As for applying for your other S corp I am not quite sure I understand your situation. I’m thinking your best bet may be to connect with your SBDC. They can help you for free. You can use the SBA local assistance locator to find help in your area.

  22. I have a question. I made a mistake when I filled the application for SBAD by covid19. I put the net amount instead of gross amount appears on my income tax. How may I correct this information. May I reapply? Thanks

    1. Walter – You will need to contact your lender if you want to change your loan amount. If you file Schedule C, though, you are supposed to use the net profit from Line 31 of your schedule C.

  23. I put in my apps for 3 of my small businesses on March 31st. All one after another.
    I had my credit pulled for the first one on 4/12 and then the next day $10,000 put into my account on 12/13. Within 24 hours I received a email on 4/14 to set up my account online, sign some docs and accept the offered loan amount. Another 5 days for closing docs to arrive on 4/18 to sign online and then money for the loan put in my account a 6 days later on 4/24/20 1,2,3 and done.
    Now the other 2 small businesses (Which were put in within 10 minutes each of the one above), are STILL not approved or denied? I did get a hard credit pull for those both on 4/20… and on 4/21 they put $10,000 each in those business accounts…. But unlike the 1,2,3 above for the first small business. it has now been 18 days since the credit pull and the $10,000 going in those accounts and NO WORD EITHER WAY???
    I know it says it can take up to an average of 45 days (average from last disaster) but does anyone have any idea of if they will send a actual denial email if I am not being approved? or do they only notify you if you are approved?
    It is very nerve-racking! I need to plan about employees, healthcare and more on if I can afford to continue paying for these things, if I don’t get the other loans I have to reconsider how to move forward. Any thoughts?

    1. We have seen some applicants get rejection notices but as you point out it’s taking a while and many applicants are in the dark. Make sure you check your email spam folder (but watch out for scammers at the same time). The only other thing I can recommend is to contact your Senators and Representative in Washington as this is a federal program.

  24. I made a mistake while applying for my loan by leaving 0 instead of 8 in the employees section. Got $1000 for advance. Wonder if I could reapply now?

    1. Jennie – Unfortunately the portal is closed to new applications except for agricultural businesses. But you could contact the SBA Disaster Assistance hotline to see if you can request reconsideration.

  25. Hello I recieved my EILD grant today I only recieved $1000. I should have recieved $2000 for myself and my dispatcher how can I correct this to get my other $1000?

  26. Has the SBA given any guidance on this specific situation?
    A person applies for the cash advance the first week it was available. Expected the amount to be deposited within 3 days. Obviously that did not happen.
    Same person applies for the PPP, and on the application answers “no” that they did not receive funding from EIDL cash advance, because at the time, that was true.
    Next, EIDL cash advance is deposited, let’s assume $2,000 for two employees.
    Next, PPP funds come through and are deposited, let’s assume $10,000.

    Question: How will the lender/bank know that the person did receive a $2,000 cash advance? Does the person have to alert the bank after the fact? Will the $10,000 PPP loan now only comprise of $8,000 forgivable because of the $2,000 cash advance?

    In this case, the person is coming up short. Expected $10,000, now only receiving $8,000 since they basically have to take the $2,000 cash advance received and pay the lender/bank for the non-forgivable portion.

    Is anyone else facing this scenario? Or are we all in a wait and see situation?

    My other question is if the entire $2,000 cash advance is used on rent and bills, and the entire $10,000 PPP is used on payroll, then will the cash advance still be subtracted from the PPP?

    Or is this a matter of the person tracking and proving to the lender that they were used for different purposes, so that the entire $10,000 can still be forgiven?

  27. If you receive the PPP grant and the $10k advance can you take the EIDL if it is available? PPP is for payroll March/April, so can EIDL be used to fund payroll after that period (I know they can’t be used for the same)?

    1. Phil, yes you can take the EIDL loan if it is offered to you. The EIDL can be used for cash flow or the following two months of payroll if you choose.

  28. I received the $1,000 EIDL advance but now have decided that I don’t need the loan. How do I repay the loan it or refuse it? And will the loan of $9,00 be considered income on my 2020 tax return, even if I return the loan right away?

    1. You can reject the EIDL loan or repay it without a prepayment penalty. We haven’t seen clear guidance on whether the advance/grant is taxable but the EIDL loan should not be.

  29. I was approved for EIDL but haven’t been funded yet. Before COVID, I was planning to purchase a home. EIDL was over $200k, so a personal guarantee is required on the loan. Will the EIDL amount be added to the debt to income ratio when I go to qualify for a mortgage loan?

    1. Keana,

      This is an SBA loan and generally they don’t appear on consumer credit reports. We don’t believe the EIDL for your business will show up on your personal credit but we can’t guarantee it won’t. You may want to discuss it with your loan officer.

  30. Hello – I received a 1000 deposit – which I assumed was the grant, but it was taken back out the same day. When I call the SBA they have no idea why this happened. Has anyone else had anything like this happen?

  31. We received our advance, what happens next? Will we have to sign loan documents before we receive our loan? Does this mean that we have been approved or declined? How will the SBA contact us moving forward?

    1. Lamont – it’s hard to say. What we’ve heard from others is that most do not hear from the SBA about the loan right away. It does not necessarily indicate an approval or decline. Check your email (including spam) for the next communication about a loan. There’s a lot of discussion about this going on in the
      SBA CARES Act Insights Hub on Facebook if you want to check it out.

  32. Thank you for the comprehensive compilation here – very helpful. I have a business that we contract with many independent contractors. As an owner, I am not a W2 employee, others are ICs, and one admin that is a W2 employee. The initial language indicated ICs were covered, and I listed them as such. I received the EIDL advance, and my impression is that the $10k is still forgive-able to cover damage costs without the same restrictions as PPP. Have you seen any clarifications or guidance on this. I know the SBA issued clarifications on the PPP, but haven’t seen for the EIDL.

    1. Tory – EIDL can be used to pay working capital expenses the business could not pay due to the disaster. Whether you have contractors is not a part of the application for EIDL – maybe you also applied for PPP? If you received EIDL (which comes directly from the SBA not a bank or other lender) then you may use it to pay those working capital expenses which may include contractors. If you’re still not sure, your local SBDC should be able to help you understand how EIDL can be used. Use the SBA local assistance locator to find help in your area.

  33. Applied for EIDL loan on 04/03/20 application # 33017***** also asked for EIDL grant. On 04/14/20 I recieved an email from SBA informing applicants that the advance amount would be $1000 per employee with a $10,000 max. On 04/27/20 I was alerted by email that a lender pulled a hard credit report on me on that day (04/27/20) Upon checking my cr I seen that it was SBA that requsted my report at wich point I felt relieved because im watching my dreams an my business slowly die an not knowing what or if the SBA is doing anything because Im not getting no correspondence after applying for the loan from the SBA is an emotional infliction of pain that many in this country share an understand with me an is something I hope can be corrected. So now after learning this I know Im more than just an application number an the SBA is looking at my loan request an because they did a hard pull on my credit I might get an EIDL loan an I have successfully submitted an application so now I will get the EIDL Advance that will temporarily save me until they complete the loan process. So now I wait patiently for an Email or a deposit but now with Hope and Determination because I know my business has a chance an I may be down but im not out yet. So now its 4 days later 05/01/20 no email an no deposits
    So I decide to try an get thru to SBA Disaster Assistance customer service center (1-800-659-2955)
    I was able to get thru an explained my concern that SBA did a hard pull on my cr and I haven’t recieved an email or deposit an was wondering if I am correct about I should recieve the Advance now because I believe by pulling my cr I have successfully submitted an application…. She says since its been 4 days an I didn’t recieve a deposit after my cr being pulled she was transferring me to a Tier 2 representative, after a brief hold I was connected an explained my concern, the gentlemen asked for my app # an was able to look up my status. He then updated me on my loan request…
    I will be notified by Email but my loan was declined because my credit score is too low and I will not get the EIDL Advance because my loan was declined….. Thanks for reading this I just wanted to share my experience.
    Im at a loss for words, thoughts or feelings at this time.
    I feel like I been tricked by this hole EIDL process, It don’t seem right but I don’ t know? Thanks and good luck with your applications,

    1. I have a question please advise if possible. I applied for the EIDLloan for my husband but I’m also listed on the application, we have the percentage of ownership marked for 50/50….will this prevent us from being approved or would funding occur jointly in our joint checking acct…thank you so much for your time. I appreciate

      any and all advice.

      1. Brandy – unless one of you does not have acceptable credit I see no reason why it would be a problem. You provide the bank account information when you apply so that’s where funds will be deposited.

  34. Hi Gerri,

    I applied for EIDL a month ago but still haven’t received the funds yet. Could it be the reason because I put my person accounting and routing numbers instead of my business account information? Please advice. Thank you!

    1. Denis – I doubt it. The SBA appears to be very backed up. Make sure you check your spam folder for messages as well. You can always contact them directly using the information in this article.

      1. Gerri,

        Thank you for your prompt reply. Just spoke with a representative by phone (1-800-659-2955) and was told that there is no possible way to check my current status of the EIDL Emergency Advance grant. I guess my only option is to wait and see what happens.

  35. We applied for the EIDL on March 31st and checked the grant box. It says they are processing first come first served, but other businesses in my small downtown community have received their grant money and they applied days after us. We still have received nothing and I am concerned we should be reapplying. Are they actually using a first come first served process?

    1. Nicole – I don’t have insights into how it’s working behind the scenes unfortunately. Right now the portal is closed so you can’t reapply. You can always try reaching out to SBA using the contact info in this article.

  36. Hi,
    I applied for EIDL and received $9000.00 in my bank account last week. Since October 2019 my credit score has gone down in the drain. I do have a SBA loan for our property and new construction approved in July 2018 and completed in August 2019. I have made payments since then, all auto and mortgage payments are paid on time. I got behind on credit cards due to construction delays and tropical storm, slow winter months and then COVID-19. My score is now in mid 500s back in October was 740. Do they look at history or just current credit scores? Not sure what to expect.
    Please advise

    1. I wish I knew. There is some leeway apparently for those whose credit was recently impacted by coronavirus though if they are just pulling score (and not reports) it seems that would be hard to determine. I just don’t know how thoroughly they are vetting that. But you are allowed to ask for reconsideration if you are turned down.

  37. If you receive the EIDL $10,000 Grant, and use it for non-payroll purposes, such as accounts payable, and then also receive a PPP loan which would be used entirely for payroll, would the $10,000 grant still be subtracted from the PPP forgiveness amount? If that $10,000 is subtracted from the PPP forgiveness amount is there any reason to also apply for the EIDL?

  38. I have a new business and have not been required to file with the IRS yet. Will SBA consider projected 2020 gross revenue forecast statements for the EIDL loan? We were about to hire 8 individuals and start shipments of product that was just received from our manufacturer 2 weeks prior to the shutdown. Thank you for the wonderful article.

    1. You can apply for EIDL if you were in business before the date of the declared disaster – January 31, 2020. But as for how to apply with no 2019 revenues you’ll need to check with the Disaster Assistance hotline or your Small Business Development Center to find out for sure. Thanks for the kind words!

  39. Is there a time limit to use the EIDL Advance?
    We received both PPP and an EIDL-A. The PPP must be used within 8 weeks to be forgivable. Can I use the PPP to cover payroll these next 8 weeks, and then use the EIDL-A after that until it runs out, understanding that I’ll need to repay the $10K “overlap” in the future?