4 Things You Need to Know Before Requesting an EIDL Loan Increase
The Small Business Administration lifted its disaster loan cap to $2 million. Here's how to apply.
If you've received an Economic Injury Disaster Loan (EIDL) from the Small Business Administration, chances are you may be eligible for more money. The SBA lifted the cap on EIDL loans up to $2 million, from $500,000, on September 8, 2021. So-called Covid EIDL loans, which offer 30-year maturities and interest rates ranging from 2.75 percent to 3.75 percent, are available to businesses that are struggling amid the pandemic. The SBA has extended what is considered a small business to include businesses that have one of the following NAICS Codes and have 500 or fewer employees per physical location and, together with affiliates, have no more than 20 locations. These NAICS codes begin with 61, 71, 72, 213, 3121, 315, 448, 451, 481, 485, 487, 511, 512, 515, 532, or 812.
Here's how to determine your eligibility, what you'll need to apply, and a timeline for when you might actually see the money hit your account.
1. Request an increase.
Log in to the online portal for businesses that the SBA created for those requesting EIDLs. (Same portal for all EIDLs.) Once you do, you will see either a button that says "Request an Increase" or a "quote" displayed with your eligible amount. The "Request an Increase" button takes applicants to the EIDL application for up to $2 million. If you don't see that button, it means you are not currently eligible for an increase. If you see a quote displayed, click on "Review and Accept Amount" and use the slider tool to confirm your requested amount. The maximum loan amount for which you're eligible is a product of your 2019 revenue subtracted by your cost of goods sold times two. If you have no COGS, subtract 0.
Note that if you've already applied for an EIDL loan or increase, and it has not yet fully funded, you will not see the "Request an Increase" button on your portal yet, even if you are eligible.
2. Do more paperwork.
If you are eligible, you must sign and submit a Form 4506T, which allows the SBA to request a transcript of your tax return from the IRS. Make sure the business address on the 4506T matches the address you used on your 2019 tax return (which also has to be submitted). If it does not, the form will be rejected or "not found." Turn off your pop-up blocker if you are experiencing trouble at this stage. Additional documents will be required for loans over $500,000. These are in addition to your 2019 federal income taxes and 4506T:
o ODA Form P-022 - Standard Resolution
o SBA Form 2202 - Schedule of Liabilities
o SBA Form 413 - Personal Financial Statement
o List of Real Estate Owned (template on intake form)
3. You may need to troubleshoot.
If you think you made an error in your application, were denied for "unverifiable information," or haven't heard anything, email pdc.reconsideration@sba.gov or pdcrecons@sba.gov. (They go to the same place.) Note your application number in the subject line and attach the denial letter if applicable. The body of the email should include loan number, company name, owner name, address, and contact information. If you cannot see the button and believe you are eligible for an increase, email CovidEidlIncreaseRequests@sba.gov. The customer service email address for any other matters is disastercustomerservice@sba.gov.
4. Prepare to wait.
Even after all of this, you might not get your funds right away. The SBA will contact you if it needs any other documentation or clarification through the email address on file. The estimated timeline for approval is three weeks for amounts under $500,000 and six weeks for amount over $500,000. If you are waiting on approval for a loan under $500,000 and an increase to over $500,000, the timeline is closer to nine weeks.
Make sure to monitor your email for any information from @sba.gov accounts.
