Today, just a few days after SBA Administrator Isabel Guzman was sworn in, the SBA announced major changes to the COVID-19 EIDL loan program: the EIDL loan limit has increased dramatically. Increasing loan limits was one of Guzman’s promises during her confirmation hearing. Here’s what you need to know about the new loan limits, how to apply for a loan, and what to do if you already have an EIDL loan.
What Are the New EIDL Loan Limits?
The SBA increased the limit for COVID-19 EIDL loans today to $500,000. This is more than triple the loan limit of $150,000 that the program has had up until now. Basically, the SBA is changing how they calculate the loan size from 6 months of economic injury to 24 months of economic injury.
“More than 3.7 million businesses employing more than 20 million people have found financial relief through SBA’s Economic Injury Disaster Loans, which provide low-interest emergency working capital to help save their businesses. However, the pandemic has lasted longer than expected, and they need larger loans,” said Guzman.
The move follows on the heels of the SBA’s announcement last week that payment on all EIDL loans has been deferred until 2022. The more flexible loan terms make EIDL loans, which have lower interest rates than many commercial lenders, even more appealing for small business owners who need funding to recover from the pandemic.
Can You Get An EIDL Loan Increase?
If you’ve already received an EIDL loan through the program, you will be able to get more funding. The SBA will reach out directly to businesses by email so as of now, no action is needed.
The SBA has also said they will provide more information prior to April 6 with more guidance. Those applying now to the EIDL program will automatically be considered for the full $500,000 in funding.
How Can You Apply for an EIDL Loan?
You can apply online for the EIDL program here. The application asks for information about your business, the business owners, and your 2019 pre-pandemic revenue.
Conclusion: The EIDL Program Continues to Improve
The increase in EIDL loan limits will make the program more helpful for small business owners who need funding to survive after a historically difficult year. We are glad to see that small business owners will be able to get more funding through the program!
Check out our YouTube video below to learn more about today’s announcement, and don’t forget to enable push notifications from the Skip App so you can get the latest news on stimulus programs like the EIDL.
📌 In other news... On Thursday, the Senate voted to extend the PPP program an additional 2 months.
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