- May 22, 2020
In March, the Small Business Administration (SBA) announced that Economic Injury Disaster Loans (EIDLs), typically only available for natural disasters, would be available for businesses with COVID-19 losses. It was announced that an EIDL could be easily applied for through the SBA's website, without involving a bank, and applicants could receive up to a $2 Million low-interest loan, with a $10,000 forgivable advance within three business days of their application. The Program, however, has been beset with delays and changes: Applicants did not receive $10,000 within three days, but a much smaller advance several weeks later (if at all), and silence from the SBA on the status of their EIDL application.
The SBA is now, many weeks later, asking applicants if they are still interested in receiving an EIDL and asking them to complete the application. Emails are being sent from the address: email@example.com. If waiting on information regarding an EIDL application, be sure to check inboxes, spam and trash for any email from this address.
After applicants now complete a more substantive application than previously submitted, the SBA is providing substantive loan documents for review and execution. Applicants will want to be sure to consult with legal counsel for review of these documents.
For loans over $25,000, the SBA is requiring a general security interest in any and all collateral of the business. For loans over $200,000, the SBA is requiring a personal guarantee.
The attorneys at Burke, Warren, MacKay & Serritella, P.C. are available to assist with the review of EIDL documents and other loan and government program issues.