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WEBINAR:US Small Business AdministrationEconomic Injury Disaster Loan Program
Brought to you by the University of St. Thomas:
• Schulze School of Entrepreneurship
• Small Business Development Center
• Family Business Center
US Small Business AdministrationEconomic Injury Disaster Loan Program
Small Business Development Centerwww.stthomas.edu/centers/[email protected]
Small Business Development Center
• Nationwide Program• St. Thomas Partnership with SBA since 1981• Free & Confidential Business Advising
Economic Injury Disaster Loan (EIDL)
Upon request from Governor Tim Walz, the U.S. Small Business Administration is offering low-interest federal disaster loans for working capital to Minnesota small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19).
Economic Injury Disaster Loan (EIDL)
Program Details• Eligible entities may borrow up to $2 million dollars.• The interest rates for this disaster are 3.75 percent for
small businesses and 2.75 percent for nonprofit organizations.
• Terms up to 30 years, with no prepayment penalties.• There is no cost to apply.• 12-month deferral (from closing date) for first payment.
Economic Injury Disaster Loan (EIDL)
Program Details• Economic Injury Disaster Loans over $25,000
require collateral.• SBA's EIDL's funds come directly from the U.S. Treasury.• Applicants do not go through a bank to apply.• Apply directly to the SBA's Disaster Assistance Program
at DisasterLoan.sba.gov.
Determining Loan Amount
• SBA Determines Loan Amount and Term• Estimating Your Business Losses
– Replacement of revenue to breakeven
• Allowable Use of Funds– Debt payments, payroll, rent, accounts payable, other– No debt re-finance
• Estimating Length of Disaster– SBA “looking at” six month disaster period
Program Eligibility
• The applicant business must have a physical presence in Minnesota.
• The applicant's economic presence alone in Minnesota does not meet this requirement.
• The applicant must show substantial economic injury directly or indirectly as a result of Coronavirus.
• Ineligible businesses include: Agricultural Enterprises, Religious Organizations, Charitable Organizations, Gambling Concerns, Casinos and Racetracks.
• The Applicant's business meets the requirements of theSBA's definition of a "Small Business."
• The Applicant's business has a minimum of one-year operating history.
• The Applicant has an acceptable credit score.• The Applicant can show ability to repay the loan after the
deferral period.• The Applicant will personally guarantee the loan.• The Applicant will pledge collateral for loans over $25,000.
Program Eligibility
Application Process
• Multiple Government Forms• No Cost to Apply• First Step
– Eligibility (evidence of injury, pre-disaster cash flow, credit score)
• Next Steps– Estimate business losses (SBA form 1368)– Complete paper application/Input on-line
• Three Week Decision (SBA target)– Add a couple weeks for disbursement if approved
SBA Economic Injury Disaster Loan (EIDL) On-Line Applicationhttps://disasterloan.sba.gov/ela/
FormsLoan Application – SBA Form 5https://disasterloan.sba.gov/ela/Documents/Disaster%20Business%20Loan%20Application%20(SBA%20Form%205).aspx
Loan Application for Sole Proprietorships - SBA Form 5Chttps://disasterloan.sba.gov/ela/Documents/Disaster%20Home%20Loan%20Application%20(SBA%20Form%205c).aspx
Personal Financial Statement – SBA Form 413Dhttps://disasterloan.sba.gov/ela/Documents/Personal_Financial_Statement.aspx
Schedule of Liabilities – SBA Form 2202https://disasterloan.sba.gov/ela/Documents/Schedule_of_Liabilities.aspx
Additional Filing Requirement, Monthly Sales – SBA Form 1368https://disasterloan.sba.gov/ela/Documents/Monthly_Sales_Figures_(1368).aspx
Request for Transcript of Tax Return – IRS Form 4506-Thttps://disasterloan.sba.gov/ela/Documents/Request%20for%20Transcript%20of%20Tax%20Return%20(IRS%20Form%204506T).aspx?pt=Home&sp=1
EIDL Supporting Informationhttps://disasterloan.sba.gov/ela/Documents/EIDL%20Supporting%20Information%20(P-019).pdf
Future Webinars
• Tuesday, March 31HR Policies & Practices During CrisisRon Linneman, Employee Benefits Consultant, WA Group
• Business Owner PanelSharing Wins: What’s Working in Your Business
• Have a need or idea for more? Email [email protected].
US Small Business AdministrationEconomic Injury Disaster Loan Program
Small Business Development Centerwww.stthomas.edu/centers/[email protected]