Starting the week of April 6, the loan limit for COVID-19 Economic Injury Disaster Loans (EIDL) will jump from six months of economic injury with a maximum loan amount of $150,000 to up to 24 months of economic injury with a maximum loan amount of $500,000.
Any COVID-19 EIDL loans in process when the new loan limits go into effect will automatically be considered for the new maximum limits. Existing COVID-19 EIDL borrowers will be able to request an increase beginning April 6. The U.S. Small Business Administration (SBA) will provide updated instructions on how to request a loan increase on SBA.gov and also will reach out directly via email to existing COVID-19 EIDL borrowers with loans approved prior to the increased loan limit taking effect.
COVID-19 EIDL loans have a 30-year maturity with interest rates of 3.75% for small businesses, including sole proprietors and independent contractors, and 2.75% for not-for-profits.
Recently, the SBA announced that it was extending deferment periods for COVID-19 EIDL loans whereby COVID-19 EIDL recipients won’t have to start making payments on their loans until 2022, though borrowers may voluntarily continue to make payments during the deferment as interest will continue to accrue on the outstanding loan balance.
The information presented here should not be construed as legal, tax, accounting, or valuation advice. No one should act on such information without appropriate professional advice and after a thorough examination of the particular situation.