Blog

Everything You Need to Know About SBA COVID-19 Economic Injury Disaster Loans

 0
Everything You Need to Know About SBA COVID-19 Economic Injury Disaster Loans
The current Pandemic has all of us these days on edge.

Cities and towns across the country are beginning to grapple with the economic impact that mitigating the spread of COVID-19. Small business owners are concerned about cash flow during this time when people are encouraged by public health officials to stay home and when non-essential businesses are encouraged to close in most areas of Pennsylvania. 

Small businesses, in particular, are being hit hard. The good news is the Small Business Administration (SBA) is to provide emergency loans to small businesses affected by this disaster. Here is what you need to know. 


Ineligible Entities
  • Agricultural Enterprises
  • Religious Organizations
  • Gambling Concerns 
  • Casinos & Racetracks 
  • Cannabis Industry

Loan Approval Criteria
  • Acceptable Credit History 
  • Credit Score of 600
  • Ability to repay the SBA loan
  • Only available to small businesses that are unable to obtain credit elsewhere

How Much You Can Borrow
  • Up to $2 million
  • 3.75 percent interest rate for small businesses and 2.75 percent for nonprofit organizations
  • Terms up to 30 years
  • Eligibility for these working capital loans are based on the size (must be a small business) and type of business and its financial resources
  • Up to $25,000 without collateral

How The Funds Can Be Used
  • To pay fixed debts, payroll, accounts payable, and other bills 
  • It cannot replace lost sales or profits or for expansion
  • It cannot be used to pay down long-term debt

Requirements
  1. Completed SBA loan application (SBA Form 5)
  2. Tax Information Authorization (IRS Form 4506T) for the applicant, principals, and affiliates
  3. Complete copies of the most recent Federal Income Tax Return
  4. Schedule of Liabilities (SBA Form 2202)
  5. Personal Financial Statement (SBA Form 413)
  6. Income, balance sheet, and cash flow documents

Other Information That May Be Requested
  • 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
  • Additional Filing Requirements (SBA Form 1368) providing monthly sales figures

How Soon Will Businesses Receive Money
Eligible businesses that submit complete loan packages could receive the money within three (3) weeks. According to SBA, the decision on an application will be completed in 21 days of submission. However, incomplete or inaccurate information and verification of collateral will delay the approval process

How to Apply
Online applications are encouraged. Applicants may apply online using the Electronic Loan Application (ELA) via SBA’s secure website at https://disasterloan.sba.gov/ela

Deadline
Application Filing Deadline is December 21, 2020.

Reach Out To Us
As Duquesne Small Business Development Center we are here to serve you and provide you the resources that you need to get through this challenging time. We can help you go through the application: identify the documents/collateral information needed and prepare the package for submission.

If you have any questions regarding the application process, please email us at duqsbdc@duq.edu or call us at 412-396-1633.

Please know we feel your pain and passionately believe in the vital importance your businesses play in the overall economy. We are here to serve you and will continue to do so and we will get through this!
 0

Comments (0)