WEBINAR: US Small Business Administration Economic Injury Disaster - - PowerPoint PPT Presentation

WEBINAR: US Small Business Administration Economic 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 Administration Economic Injury Disaster Loan Program

Small Business Development Center www.stthomas.edu/centers/sbdc smallbusiness@stthomas.edu 651.962.4500

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

• rganizations.
• 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 the

SBA'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 Application https://disasterloan.sba.gov/ela/ Forms Loan Application – SBA Form 5 https://disasterloan.sba.gov/ela/Documents/Disaster%20Business%20Loan%20Application%20(SBA%20Form%205).aspx Loan Application for Sole Proprietorships - SBA Form 5C https://disasterloan.sba.gov/ela/Documents/Disaster%20Home%20Loan%20Application%20(SBA%20Form%205c).aspx Personal Financial Statement – SBA Form 413D https://disasterloan.sba.gov/ela/Documents/Personal_Financial_Statement.aspx Schedule of Liabilities – SBA Form 2202 https://disasterloan.sba.gov/ela/Documents/Schedule_of_Liabilities.aspx Additional Filing Requirement, Monthly Sales – SBA Form 1368 https://disasterloan.sba.gov/ela/Documents/Monthly_Sales_Figures_(1368).aspx Request for Transcript of Tax Return – IRS Form 4506-T https://disasterloan.sba.gov/ela/Documents/Request%20for%20Transcript%20of%20Tax%20Return%20(IRS%20Form%204506T).aspx?pt=Home&s p=1 EIDL Supporting Information https://disasterloan.sba.gov/ela/Documents/EIDL%20Supporting%20Information%20(P-019).pdf

Future Webinars

• Tuesday, March 31

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• Business Owner Panel

Sharing Wins: What’s Working in Your Business

• Have a need or idea for more? Email

schulzeschool@stthomas.edu.

US Small Business Administration Economic Injury Disaster Loan Program

Small Business Development Center www.stthomas.edu/centers/sbdc smallbusiness@stthomas.edu 651.962.4500