In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. This advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available following a successful application. This loan advance will not have to be repaid.
What businesses are eligible to apply?
SBA’s Economic Injury Disaster Loans (or working capital loans) are available to small businesses, small agricultural cooperatives, small aquaculture businesses and most private non-profit organizations. This includes:
- Businesses directly affected by the disaster
- Businesses that offer services directly related to the businesses
- Other businesses indirectly related the industry that are likely to be harmed by losses in their community
(Example: Manufacturer of widgets may be eligible as well as the wholesaler and retailer of the product.)
What is the criteria for a loan approval?
- Credit History-Applicants must have a credit history acceptable to SBA.
- Repayment –SBA must determine that the applicant business has the ability to repay the SBA loan.
- Eligibility- The applicant business must be physically located in a declared county and suffered working capital losses due to the declared disaster, not due to a downturn in the economy or other reasons.
What are the collateral requirements?
- Economic Injury Disaster Loans over $25,000 require collateral.
- SBA takes real estate as collateral when it is available.
- SBA will not decline a loan for lack of collateral, but requires borrowers to pledge what is available.
What kinds of small businesses can apply?
Examples of eligible industries include but are not limited to the following: hotels, recreational facilities, charter boats, manufactures, sports vendors, owners of rental property, restaurants, retailers, souvenir shops, travel agencies, and wholesalers.
What other criteria is involved?
The applicant business must have a physical presence in the declared disaster area. An applicant’s economic presence alone in a declared area does not meet this requirement. The physical presence must be tangible and significant. Merely having a P.O. Box in the disaster area would not qualify as a physical presence.
SBA’s Working Capital Loans are Different from Other SBA Loans
- SBA’s Economic Injury Disaster Loan (EIDLs) funds come directly from the U.S. Treasury.
- Applicants do not go through a bank to apply. Instead apply directly to SBA’s Disaster Assistance Program at: DisasterLoan.sba.gov
- There is no cost to apply.
- There is no obligation to take the loan if offered.
- The maximum unsecured loan amount is $25,000.
- Applicants can have an existing SBA Disaster Loan and still qualify for an EIDL for this disaster, but the loans cannot be consolidated.
Basic Filing Requirements
- Completed SBA loan application (SBA Form 5 or 5C).
- Tax Information Authorization (IRS Form 4506T) for the applicant, principals and affiliates.
- Complete copies of the most recent Federal Income Tax Return.
- Schedule of Liabilities (SBA Form 2202).
- Personal Financial Statement (SBA Form 413).
- Although a paper application and forms are acceptable, filing electronically is easier, faster and more accurate.
Other Information may also be requested.
- Complete copy, including all schedules, of the most recent Federal income tax return for principals, general partners or managing member, and affiliates (see filing requirements for more information).
- 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 .
- A current year-to-date profit-and-loss statement .
- Additional Filing Requirements (SBA Form 1368) providing monthly sales figures. (This is especially important for Economic Injury Disaster Loans.
How to Apply
- Applicants may apply online using the Electronic Loan Application (ELA) via SBA’s secure website at https://disasterloan.sba.gov/ela.
- Paper loan applications can be downloaded from www.sba.gov/disaster. Completed applications should be mailed to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.
- Disaster loan information and application forms may also be obtained by calling the SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard-of-hearing) or by sending an email to firstname.lastname@example.org.
What's next? What should you expect?
- You will receive email confirmation that your application has been submitted
- You will receive an email letting you know that your application is under review.
- BE PREPARED: You will be contacted by someone from the SBA
- Have your monthly expenses and financial projections ready (your local SBDC can help with this)
IMPORTANT: Tips to Apply
- Use Internet Explorer or Mozilla Firefox to apply.
- The 'Help Button' provides useful information for each page.
- Use the 'Save Button' frequently.
- Be patient and keep trying if you experience slow load times.
- If you have a business who would like free assistance with completing their applications; please have them register by following these steps:
- Visit www.tsbdc.org
- Select "Request Free Advising"
- Select "Local Advising" and Choose Your County
- Complete the Requested Information (it's a SBA Form 641 for confidential counseling)
- A business counselor will contact the firm within 48 hours to set an appointment or start the process over the phone and/or via online video conferencing