Updates from the SBA webinars
SBA is encouraging small businesses and nonprofits interested in the Economic Injury Disaster Loans (EIDL) to apply as soon as possible. The loans are first come, first served. Applicants can ask for an increase later if additional funds are needed. The webinar covered the following points:
- Illinois has received a disaster designation, so small businesses and not-for-profits can apply for the loan funds.
- These are working capital loans used to pay business expenses.
- Eligible entities may qualify for loans up to $2 million.
- Interest rates are 3.75% for small businesses, 2.75% for nonprofit organizations; terms up to 30 years; first payment deferred for one year.
- Apply directly to SBA’s Disaster Assistance Program. Do not go through a bank to apply.
Ineligible businesses and nonprofits:
- Agricultural enterprises. If the primary activity of the business (including its affiliates) is as defined in Section 18(b)(1) of the Small Business Act, neither the business nor its affiliates are eligible for EIDL assistance.
- Religious organizations.
- Charitable organizations.
- Gambling concerns (for example: concerns that derive more than 1/3 of their annual gross revenue from legal gambling activities).
- Casinos and racetracks (for example: businesses whose purpose for being is gambling, such as casinos, racetracks, and poker parlors, are not eligible for EIDL assistance regardless of 1/3 criteria above).
Best Advice: If you believe you will need loan funding, attend one of the informational webinars. Make sure you have financial information for your business from 2019. The loan application requires a tax return. Have a compiled balance sheet and income statement through the date you apply for the loan. On the webinar, SBA said that applicants can ask for a specific amount in the narrative section of the application; however, it will ultimately be the SBA Loan Processor who decides the amount of the final loan.
The Illinois District SBA office is scheduling webinars daily. Register:
- March 24, 9 AM: Economic Injury Disaster Loans, SBA
- March 25, 9 AM: Economic Injury Disaster Loans, SBA
- March 25, 1 PM: Economic Injury Disaster Loans, SBA
- March 26, 9 AM: Economic Injury Disaster Loans, SBA
- March 26, 1 PM: Economic Injury Disaster Loans, SBA
- March 27, 9 AM: Economic Injury Disaster Loans, SBA
- March 27, 1 PM: Economic Injury Disaster Loans, SBA
Pam Schallhorn is a University of Illinois Extension Specialist in Community and Economic Development specializing in small business development and entrepreneurship. Previously, she was a Vice President of Commercial Lending for several banks and served as the Director of the Small Business Development Center in Rockford. She holds a bachelor’s in finance and a master’s in political studies. Her office is in Springfield. Email Pam.