Frequently Asked Questions: COVID-19 Economic Injury .

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Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)1. What is the difference between Economic Injury Disaster Loan (EIDL) and the PaycheckProtection Program (PPP)?Economic Injury Disaster Loan (EIDL)Paycheck Protection ProgramNO LONGER AVAILABLEDESCRIPTION Long-term direct loan program from theSBALoans made through nearly 5,500lenders across the countryPURPOSETo meet financial obligations andoperating expenses that could havebeen met had the disaster notoccurred.Designed to provide an incentive forsmall businesses to keep workers on thepayroll.AMOUNTAVAILABLESix months of working capital.Up to 10 millionTERMS3.75% APR (fixed): businesses1%2.75% APR (fixed); non-profits2 years or 5 years, depending on whenloan was approved30 yearsCOLLATERALRequired for loans over 25,000No collateral requiredPERSONALGUARANTEE?Requires a personal guarantee onlyfor loans exceeding 200,000Not requiredFORGIVABLE?NO. Loan may be repaid at any time withno pre-payment penalties.FORGIVEN if all employee retentioncriteria are met and funds used foreligible expenses.If borrower received EIDL Advance,SBA is required to reduce the borrower’sloan forgiveness amount by the amountof the EIDL Advance.Details available online atSBA.gov/PaycheckProtection.1st PAYMENT1st payment deferred 1 year; you canmake payments if you like.Complete and submit SBA Form 1201Borrower Payments on Pay.gov.APPLY9/24/2020 2:34 PMApply onlinePayments will be deferred for a period oftime depending on when borrowersubmits a request for loan forgiveness.No longer available. CheckSBA.gov/PaycheckProtection for latestinformation.1 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)2. Can I apply for both COVID-19 EIDL and PPP?Yes. Borrowers can apply for both the PPP and EIDL, although funds from both cannot beused for the same purpose. The Paycheck Protection Program loan proceeds must be used for eligiblepurposes according to guidance and some or all of the loan may be forgiven ifused properly. The authority to make PPP loans has expired and new PPPloans are no longer available. Check online for latest information. EIDL funds can be used for working capital and normal operating expenses, suchas continuation of health care benefits, rent, utilities, fixed debt payments. Note that businesses that received an EIDL Advance in addition to the PPP loanwill have the amount of the EIDL Advance subtracted from the forgiveness amountof their PPP loan.3. What can I use COVID-19 EIDL funds for? And how is that different from PPP funds?EIDL proceeds can be used to cover a wide array of working capital and normal operatingexpenses, such as continuation of health care benefits, rent, utilities, and fixed debt payments.The Paycheck Protection Program loan proceeds must be used only for eligible payroll costsand certain eligible nonpayroll costs as set forth in program guidance. The loan may beforgiven if all employee retention criteria are met and funds were used for eligible expenses.Retain receipts and contracts for all loan funds spent for 3 years.4. Who is eligible for COVID-19 EIDL?Applicant must be physically located in the United States or designated territory andsuffered working capital losses due to the coronavirus pandemic, not due to a downturnin the economy or other reasons. Eligible applicants include: Businesses with 500 or fewer employees or defined as small per SBA.gov/SizeStandardsCooperatives with 500 or fewer employeesAgricultural enterprises with 500 or fewer employeesMost private nonprofitsFaith-based organizationsSole proprietorships and independent contractorsIneligible businesses include those engaged in illegal activities, loan packaging, speculation,multi-sales distribution, gambling, investment or lending.9/24/2020 2:34 PM2 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)5. What if I am not a U.S. Citizen but my business meets all the other criteria for a COVID-19 EIDL?A non-US citizen who owns 20% or more of the business is eligible if they are classified as a “noncitizen national” or “qualified alien.” Qualified aliens include permanent residents with a currentgreen card. Refer to SOP 50 30 9, Appendix 7.6. What is the process to receive an Economic Injury Disaster Loan (EIDL) for COVID-19?Apply www.sba.gov/disasterLoan Quote This is an estimate of qualified loanamount; does not mean loan isapproved. Applicant needs to chooseloan amount up to this maximum.ApplicationReviewed Loan Officer reviewsfor completeness May contact applicantfor more informationLoanDecisionIF APPROVEDEmail sent to applicant(s) to sign loandocuments.Be sure to download a copy for your records.Loan proceeds transferred to bank accountwithin 5-10 business days.Retain receipts and contracts for all loan fundsspent for 3 years.Make payments through Pay.gov OR mailpayments to: Approved orDeclinedIF DECLINEDDecline letter sent via email.Applicant can request reconsideration in writingwithin 6 months of the date of decline letter.Send to:U.S. Small Business Administration721 19th StreetDenver, CO 80202E-mail: pdcrecons@sba.govMail: U.S. Small Business AdministrationDisaster Assistance Processing &Disbursement Center14925 Kingsport RoadFort Worth, Texas 76155On mailed payment, include: Business Name Borrower’s Name Tax ID/EIN or SSN Application NumberInclude your application number and anyinformation required to overcome the reason fordecline.The process will vary depending on reasonfor decline.9/24/2020 2:34 PM3 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)7. How can I check the status of my application?Applicants will receive an invite to log-in to the customer portal to review the application,select an eligible loan amount, and submit for final review. If the loan is not approved, theapplicant will receive an email notification with a detailed reason for the loan decline,including instructions on how to appeal the decision. Contact customer service to checkon status: 1-800-659-2955.8. I received an initial loan quote. Does that mean I’ve been approved?No, that is simply an estimate of the loan you may be qualified to receive. Once you receive theinitial loan quote:1. Log into your SBA Loan Portal2. Choose how much you want your loan amount to be, up to the maximum quoted3. Be sure to click the submit buttonOnce that is completed, your application will be advanced to the final review stage. You may becontacted by a Loan Officer to submit additional information. Please respond promptly so yourapplication can be processed.9. I received the loan; how do I make payments?Set up online payments by completing SBA Form 1201 Borrower Payments on Pay.gov.If you prefer to mail payments, send them to:U.S. Small Business Administration721 19th StreetDenver, CO 80202On mailed payments, be sure to include: Business Name Borrower’s Name Tax ID/EIN or SSN Application or Loan Number10. I have a business partner, but he/she does not want to be included on the COVID-19 EIDLapplication. Can I still apply?All 20% or more owners are required to be included on the application and at least 81%ownership needs to be accounted for on the application in order to be considered.9/24/2020 2:34 PM4 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)11. What if I need more money than I’ve been approved for?COVID-19 EIDLs can be modified by increasing the amount up to 6 months of working capital.An increase can be requested either before or after accepting the loan. If applicant is in urgentneed of funds, accept the maximum loan amount offered and then request an increase byproviding additional documentation.If you were approved for a loan and would like to request an increase to the amount, send anemail that states your need for an increase to the loan amount to pdcrecons@sba.gov with theword “INCREASE” in the subject line. Include any additional information that may assist us inconsidering an increase for your application. For example:1. Your most recent Federal tax return for your business along with a signed IRS Form 4506-T2. For updated financials (Gross Revenue, Cost of Goods Sold, cost of operation, or othersources of compensation), submit Form 3502.12. What if I don’t need as much money as I’ve been approved for?Have you received the 1. Log into your SBA Loan Portalinitial loan quote? 2. Choose how much you want your loan amount to be, up tothe maximum quoted3. Be sure to click the submit buttonAlready received Make check payable to SBA and send with note that indicatesfunds via Direct whether the funds should be applied to the EIDL, Advance orDeposit? both, and include: Business NameBorrower’s Name(s)Tax ID or SSNLoan NumberAlready received If the check has not been deposited, write VOID across thefunds via check? front and return check to the address below. Include: Business NameBorrower’s Name(s)Tax ID or SSNApplication NumberSend to: U.S. Small Business Administration721 19th StreetDenver, CO 802029/24/2020 2:34 PM5 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)13. I have multiple businesses. Can I submit multiple COVID-19 EIDL applications?Yes, you can submit one application per eligible business. However, at least 81% ownership needsto be accounted for on the application.14. I’ve been declined for COVID-19 EIDL. What could be the reasons for that decline?Decline reasons are unique to the applicant. The most common reasons for a decline are: Unsatisfactory credit history. Because EIDL is a government loan, federal regulationsrequire applicants to meet minimum credit standards to qualify.Unverifiable information. If an applicant does not respond within 7 days to requests foradditional information from loan officers, their application may be declined. Request areconsideration to reactivate your application.Ineligible non-US citizen status. Applicants must be US citizens, non-citizen nationals, orqualified aliens. Refer to SOP 50 30 9, Appendix 7 for further information.Business activity not eligible.Economic injury not substantiated. There are two possible reasons for this decline: 1) Theeconomic injury is less than the amount received for the EIDL Advance; or 2) Theinformation submitted does not indicate an economic injury.Character reasons. Applicants may be declined if they have been convicted of a felony inthe past five years; or ever been engaged in the production or distribution of any product orservice that has been determined to be obscene by a court of competent jurisdiction; thosewho are currently suspended or debarred from contracting with the federal government orreceiving federal grants or loans; and/or those who are presently subject to an indictment,criminal information, arraignment, or other means by which formal criminal charges arebrought in any jurisdiction.Failure to respond. If applicants do not respond to emails asking for additionalinformation or to sign loan closing documents, the application will typically expire after 60days.15. Can I request a reconsideration if my COVID-19 EIDL application is declined?Applicant has up to 6 months to request reconsideration. Send reconsideration requests to:E-mail pdcrecons@sba.govMail U.S. Small Business AdministrationDisaster Assistance Processing and Disbursement Center14925 Kingsport RoadFort Worth, Texas 761559/24/2020 2:34 PM6 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)Include any additional information that may assist us in your request. If the decline letterrequested specific information or documentation for reconsideration, you must include thoseitems.Be sure to include: Business Name Borrower’s Name Tax ID/EIN or SSN Application/Loan NumberThe process will vary depending on reason for decline.Example:Applicant receives a decline letter for their COVID-19 EIDL loan application from SBA,listing “Economic injury not substantiated” as the reason for the decline. This reason iscommon when an applicant’s self-certified financial information on their streamlinedapplication, such as the figures for Gross Revenues and the Cost of Goods Sold for thetwelve (12) month period prior to the pandemic, did not reflect an economic injury, or theinformation may have been left blank.The business owner’s request for reconsideration should be a written email/letter requestincluding the following: A written note from the applicant requesting reconsideration of their declined COVID19 EIDL loan application, which includes the Application number, Business/Entityname, Owners name(s), and address of business Copy of the most recent federal tax returns filed for the business, prior to the COVID-19Pandemic, including all schedules A completed and signed IRS Form 4506-T for the business entity Copy of a voided check for the business account (Upon SBA’s processing of the reconsideration) SBA may request additionalinformation, which may include SBA Form 3502 – EIDL Supporting Information16. If I’ve already received a COVID-19 EIDL and I’ve been affected by civil unrest, can I ask for morefunds?If you are in an area that has a Disaster Declaration, which includes civil unrest anddisasters such as flooding, storm damage, wildfires or earthquakes, you may be eligiblefor additional SBA Disaster Loans to cover damage to your home, personal possessionsand/or business.9/24/2020 2:34 PM7 P a g e

Frequently Asked QuestionsCOVID-19 Economic Injury Disaster Loan (EIDL)Check disasterloan.sba.gov to see if there is a disaster declaration for your area.SBA’s COVID-19 relief programs, such as the PPP and EIDL, are for economic impactsresulting from the coronavirus pandemic, and not for physical or economic disaster lossescaused by civil unrest or other disasters.17. I already have a PPP and COVID-19 EIDL and my business has not recovered yet from theimpacts of the COVID shutdowns; would I qualify for another loan?If your business r

Disaster Assistance Processing and Disbursement Center . 14925 Kingsport Road . Fort Worth, Texas 76155 . Frequently Asked Questions COVID-19 Economic Injury Disaster Loan (EIDL) 9/24/2020 2:34 PM 7 Page . Frequently Asked Questions COVID-19 Economic Injury Disaster Loan (EIDL)

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