SBA Loan Information

COVID Assistance from the Small Business Administration

As the coronavirus 2019 continues to spread the State of Illinois and the Center of Disease Control & Prevention has recommended steps to plan, prepare and respond. It is the Grundy County Chamber of Commerce & Industry’s mission to aid, protect and help our local business community. Below are the recommendations and resources we will follow and share with our members and community.

SBA loans now available to Illinois businesses

Released from the SBA March 19,2020:

The U.S. Small Business Administration is offering low-interest federal disaster loans for working capital to Illinoissmall businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19), SBA Administrator Jovita Carranza announced today. SBA acted under its own authority, as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act that was recently signed by the President, to declare a disaster following a request received from Gov. JB Pritzker on March 17, 2020.

The disaster declaration makes SBA assistance available in the entire state of Illinois; and the contiguous counties of Clinton, Des Moines, Dubuque, Jackson, Lee, Louisa, Muscatine and Scott in Iowa; Benton, Gibson, Knox, Lake, Newton, Posey, Sullivan, Vermillion, Vigo and Warren in Indiana; Ballard, Crittenden, Livingston, McCracken and Union in Kentucky; Cape Girardeau, Clark, Jefferson, Lewis, Lincoln, Marion, Mississippi, Perry, Pike, Ralls, Saint Charles, Saint Louis, Saint Louis City, Sainte Genevieve and Scott in Missouri; and Grant, Green, Kenosha, Lafayette, Rock and Walworth in Wisconsin.

“SBA is strongly committed to providing the most effective and customer-focused response possible to assist Illinois small businesses with federal disaster loans. We will be swift in our efforts to help these small businesses recover from the financial impacts of the Coronavirus (COVID-19),” said Administrator Carranza.

SBA Customer Service Representatives will be available to answer questions about SBA’s Economic Injury Disaster Loan program and explain the application process.

“Small businesses, private non-profit organizations of any size, small agricultural cooperatives and small aquaculture enterprises that have been financially impacted as a direct result of the Coronavirus (COVID-19) since Jan. 31, 2020, may qualify for Economic Injury Disaster Loans of up to $2 million to help meet financial obligations and operating expenses which could have been met had the disaster not occurred,” said Carranza.

“These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. Disaster loans can provide vital economic assistance to small businesses to help overcome the temporary loss of revenue they are experiencing,” Carranza added.

Eligibility for Economic Injury Disaster Loans is based on the financial impact of the Coronavirus (COVID-19). The interest rate is 3.75 percent for small businesses. The interest rate for private non-profit organizations is 2.75 percent. SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years and are available to entities without the financial ability to offset the adverse impact without hardship.

Applicants may apply online, receive additional disaster assistance information and download applications at https://disasterloan.sba.gov/ela. Applicants may also call SBA’s Customer Service Center at (800) 659-2955 or email disastercustomerservice@sba.gov for more information on SBA disaster assistance. Individuals who are deaf or hard‑of‑hearing may call (800) 877-8339. Completed applications should be mailed to U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX  76155.

The deadline to apply for an Economic Injury Disaster Loan is Dec. 21, 2020.

Fact sheet info:

Disaster Loan Assistance Available:
Economic Injury Disaster Loans (EIDLs) – Working capital loans to help small businesses, small agricultural cooperatives, small businesses engaged in aquaculture, and most private, non-profit organizations of all sizes meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. These loans are intended to assist through the disaster recovery period.

Credit Requirements:

• Credit History – Applicants must have a credit history acceptable to SBA.
• Repayment – Applicants must show the ability to repay the loan.
• Collateral – Collateral is required for all EIDL loans over $25,000. SBA takes real estate as collateral when it is available. SBA will not decline a loan for lack of collateral, but SBA will require the borrower to pledge collateral that is available.

Interest Rates:

The interest rate is determined by formulas set by law and is fixed for the life of the loan. The maximum interest rate for this program is 3.750 percent.

Loan Terms:

The law authorizes loan terms up to a maximum of 30 years. SBA will determine an appropriate installment payment based on the financial condition of each borrower, which in turn will determine the loan term.

Loan Amount Limit:

The law limits EIDLs to $2,000,000 for alleviating economic injury caused by the disaster. The actual amount of each loan is limited to the economic injury determined by SBA, less business interruption insurance and other recoveries up to the administrative lending limit. SBA also considers potential contributions that are available from the business and/or its owner(s) or affiliates. If a business is a major source of employment, SBA has the authority to waive the $2,000,000 statutory limit.

Loan Eligibility Restrictions:

Noncompliance – Applicants who have not complied with the terms of previous SBA loans may not be eligible. This includes borrowers who did not maintain required flood insurance and/or hazard insurance on previous SBA loans.

Note: Loan applicants should check with agencies / organizations administering any grant or other assistance program under this declaration to determine how an approval of SBA disaster loan might affect their eligibility.

Refinancing:

Economic injury disaster loans cannot be used to refinance long term debts.

Insurance Requirements:

To protect each borrower and the Agency, SBA may require you to obtain and maintain appropriate insurance. By law, borrowers whose damaged or collateral property is located in a special flood hazard area must purchase and maintain flood insurance. SBA requires that flood insurance coverage be the lesser of

1) the total of the disaster loan,

2) the insurable value of the property, or

3) the maximum insurance available.
Applicants may apply online, receive additional disaster assistance information and download applications at https://disasterloan.sba.gov/ela.

Download document HERE

Three_Step_Process_SBA_Disaster_Loans_page-0001
Three_Step_Process_SBA_Disaster_Loans_page-0002

SBA Disaster Assistance Resources for Businesses

Please find updated guidance from the Small Business Administration below. The disaster loan application is now open you can apply here disaster loan application. Per the SBA, “when you are applying for Coronavirus (COVID-19) disaster declarations, please only select Economic Injury when inquiring about your business losses.” Feel reach out if you have any questions. Remember our office is working to bring federal resources to you. We anticipate more resources becoming available and we are coordinating with the SBA to bring them to you.

SBA Disaster Assistance in Response to the Coronavirus

• The U.S. Small Business Administration is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19). Upon a request received from a state’s or territory’s Governor, SBA will issue under its own authority, as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act that was recently signed by the President, an Economic Injury Disaster Loan declaration.

• Any such Economic Injury Disaster Loan assistance declaration issued by the SBA makes loans available to small businesses and private, non-profit organizations in designated areas of a state or territory to help alleviate economic injury caused by the Coronavirus (COVID-19).

• SBA’s Office of Disaster Assistance will coordinate with the state’s or territory’s Governor to submit the request for Economic Injury Disaster Loan assistance.

• Once a declaration is made for designated areas within a state, the information on the application process for Economic Injury Disaster Loan assistance will be made available to all affected communities as well as updated on our website: SBA.gov/disaster.

• SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

• Eligibility requirements are determined by SBA and can be found here.

• These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.

• SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.

• SBA’s Economic Injury Disaster Loans are just one piece of the expanded focus of the federal government’s coordinated response, and the SBA is strongly committed to providing the most effective and customer-focused response possible.

• For additional information, please contact the SBA disaster assistance customer service center. Call 1-800-659-2955 (TTY: 1-800-877-8339) or e-mail disastercustomerservice@sba.gov.

• Visit SBA.gov/disaster for more information.

• Business advisors at our Illinois Small Business Development Centers (SBDCs) are available to assist small businesses with the loan application process and are currently operating remotely. Businesses can locate their nearest Small Business Development Center below.HANDOUT SBA Disaster Assistance Resources for Businesses ELA0-Business Loan ApplicationWebinar Material-Coronavirus 03.14.20

image004