COVID / SBA Frequently Asked Questions
1. What is the difference between the Economic Injury Disaster Loan (EIDL) and the SBA loan from the CARES Act?
- The EIDL is a loan provided by and administered by the SBA. The EIDL offers 3.5% interest with a 30-year payment plan and a 12-month deferral for payments. The CARES Act loan is underwritten and administered by a bank. The interest rate is 4%. More details will be coming about the specifics and a side-by-side comparison should be available by the end of the week.
2. What is the website for applying for the EIDL?
3. How long does a decision take?
- We have been told it could take 2-3 weeks for processing an application
4. Will my credit score be a factor in either loan?
- Yes, at least for the EIDL.
5. What paperwork do I need to apply?
- You should have your financial statements and tax records from 2019 if you have already filed for last year’s taxes. Additionally, you should have ready your most recent profit & loss statement and balance sheet.
6. How do I check the status of my application?
- You will need to email email@example.com to check on your application.
7. Are any of these loans forgiven under certain circumstances?
- Portions of the CARES Act funding will be forgiven. More details will be coming shortly on the specifics.
8. I already have a loan through my bank for operating expenses or something else. Can I use this loan to pay that one off?
- No. Businesses are not permitted to consolidate or use an EIDL to pay off an existing loan. They can use the EIDL to make payments on the existing loan to prevent a default.
9. Will having an existing loan hurt my chances of getting approved?
- Not necessarily. You are permitted to have an EIDL or CARES Act loan at the same time as an existing loan. If late payments are reported to the applicant’s credit report for an existing loan, that may affect your chances of receiving a loan.
10. What is the minimum credit score needed for approval.
- The SBA has not publicly provided the minimum credit score for an approval, as certain circumstances, such as payment history, may overrule a determination on credit score alone.