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How to apply for the Economic Injury Disaster Loan
Follow these 11 steps to get government aid for businesses affected by the coronavirus.
The Economic Injury Disaster Loan (EIDL) program is a government-issued loan program for small businesses in states that have been impacted by the coronavirus. Unlike other Small Business Administration (SBA) loan programs, applications are only available through the SBA disaster loan website. The SBA estimates that it will take around two hours to complete.
SBA to relaunch EIDL advances for hard-hit small businesses
The American Rescue Plan Act allowed the SBA to offer EIDL advances of up to $5,000 to small businesses that have been impacted by COVID-19. Advances are being rolled out in three parts:
- Starting 14 days after the bill is signed into law, businesses that have 10 or fewer employees that took a 50% or larger financial hit can apply.
- After 28 days, all businesses with 10 or fewer employees can apply.
- After 42 days, all other qualifying businesses can apply.
Businesses located in a low-income community with less than 300 employees can qualify for a loan if they suffered an economic loss of 30% or more during the coronavirus outbreak.
The SBA extended EIDL applications until December 31, 2021. But hasn't yet announced when applications for EIDL grants will reopen.
What's in this guide?
- Step 1: Make sure you qualify.
- Step 2: Go to the COVID-19 application.
- Step 3: Read the streamlined process requirements.
- Step 4: Complete the eligible entity verification.
- Step 5: Provide information about your business.
- Step 6: Complete the ownership information section.
- Step 7: Provide additional information.
- Step 8: Give contact information for anyone who helped.
- Step 9: Provide your bank account information and certify your application.
- Step 10: Review the summary and submit.
- Step 11: Wait to hear back from the SBA for approval
- Apply for a Paycheck Protection Loan today
- Bottom line
Step 1: Make sure you qualify.
The SBA and Coronavirus Aid, Relief and Economic Security (CARES) Act expanded eligibility for this loan program since it was first launched.
- Location. Disaster loans are available to small businesses in all US states and territories — previously you had to be in a declared disaster zone.
- Size. For-profit businesses and agricultural cooperatives must either meet SBA size standards for their industry or have fewer than 500 employees.
- Business structure. Sole proprietorships, nonprofits, employee stock ownership plans (ESOPs), agricultural and hospital cooperatives, and tribal businesses can also qualify — as long as they have fewer than 500 employees.
- Time operating. Businesses must be operating as of January 31, 2020.
- Acceptable credit history. You must have acceptable credit history by SBA standards — typically a credit score of 640 or higher — to qualify for this loan.
Consider getting help with the application if it’s your first time
Making mistakes can get your application thrown out and waste valuable time. If this is your first time applying for government financing, consider reaching out to your local Small Business Development Center (SBDC), which can offer free assistance.
Many banks are also offering customers assistance with SBA disaster loan applications, though you still have to apply through the disaster loan website.
Step 2: Go to the COVID-19 application.
Go to the coronavirus disaster loan application on the SBA disaster loan website. Make sure it’s the application for businesses affected by the coronavirus — there’s a separate application for other SBA disaster loans.
It should say COVID-19 Economic Injury Disaster Loan Application at the top.
Step 3: Read the streamlined process requirements.
The SBA has changed its process a few times for these disaster loans since the start of the outbreak, so don’t skip this section. This is where you’ll find the most up-to-date information on your legal responsibility and how long it’s expected to take.
Step 4: Complete the eligible entity verification.
Select the option that describes your business — if none apply, you’re ineligible for a disaster loan.
Then, check all statements that apply to your business. If all don’t apply, you’re ineligible for an SBA disaster loan.
Generally, you and your business must meet these criteria:
- Not engaged in illegal activity according to federal law — including cannabis
- No owner with 50% ownership or greater is more than 60 days late on child support payments
- Agriculture industry applicants are either an agricultural cooperative, nursery or aquacultural enterprise
- Doesn’t make significant revenue from adult entertainment of a sexual nature
- Gambling makes up no more than one-third of business income
- Not in the lobbying industry
- Not an entity of the state, local or municipal government — or a member of Congress
Then, click Continue.
Step 5: Provide information about your business.
In this section, you’ll provide basic information about your business.
Business name and registration
Fill in the fields with the following information about your business’s name and legal status:
- Business’s legal name. The name you registered your business in — like Sharon’s Candles LLC.
- Trade name. The name you use with customers, also called its “doing business as” (DBA) name — like Sharon’s Candles
- EIN or SSN for sole proprietorship. Businesses should enter their employer identification number (EIN) here. But sole proprietorships should write their Social Security number (SSN).
- Organization type. Select the type of business structure your company follows, such as an S corporation or general partnership.
- Is the applicant a nonprofit organization? Check Yes if your company has 501(c), (d) or (e) tax-exempt status. Otherwise, check No.
- Is the applicant a franchise? Franchise owners should check Yes. Otherwise, check No.
Revenue and compensation
You’re only required to answer the first two questions in this section:
- Gross revenue for 12 months prior to the date of the disaster. Enter your business’s total revenue before taxes between January 31, 2019 and January 31, 2020.
- Cost of goods sold for the 12 months prior to the date of the disaster. Enter the total cost associated with producing and providing your business’s products from January 31, 2019 to January 31, 2020.
Provide the following information, if it applies to your business:
- Lost rent due to disaster. Only include this if your business earns money from rental properties.
- Nonprofit cost of operation 12 months prior to the date of the disaster. Nonprofits should enter their operating costs from January 31, 2019 to January 31, 2020.
- Combined annual operating expenses for the 12 months prior to the date of the disaster for secular social services. Faith-based organizations can only qualify for funding for secular services — provide the cost of operating these services here, if it applies. List the services in the box below.
- Compensation from other sources received as a result of the disaster. Write the total your business has received to combat the coronavirus outbreak, including loans, grants and other funds. Describe the sources in the box below.
Business contact information
Fill in the fields with the following information:
- Primary business street address (not a P.O. Box)
- County, if applicable
- ZIP code
- Business phone number
- Alternative business phone number, if applicable
- Business fax number, if applicable
- Business email address
Time in business and activity
Answer the following questions about when your business was founded and its operations:
- Date business established. Write the date your business was officially registered as mm/dd/yyyy.
- Current ownership since. Write the date you or the current owner took ownership of the business as mm/dd/yyyy.
- Business activity. Select your business’s industry from the drop-down list — for example, select Eating & Drinking Places if you have a restaurant.
- Detailed business activity. Select the type of business you operate in your industry. For example, restaurants can now select Restaurant.
- Number of employees. Write the number of people your business employed as of January 31, 2020 — not today.
After finishing this section, click Next.
Step 6: Complete the ownership information section.
In this section, you’ll provide information about business owners and any business entities that own it.
Business applicant parent entity
First, answer: Is your Business owned by a business entity?
If you check No, skip ahead to the Individual owner or agent section. Otherwise, check Yes and provide the following information about that entity:
- Legal business name
- Street address
- Employer Identification Number
- ZIP code
- Business phone number
- Business email
- Business type (same as the organization type)
- Ownership stake in your company
The business entity is also required to sign a guarantee on your loan.
Individual owner or agent
You’ll need to fill out this section for each business owner. Provide the following information:
- First name
- Last name
- Cell phone number
- Title or office in the company
- Percentage of ownership
- Email address
- Social Security number
- Date of birth, written mm/dd/yyyy
- Place of birth
- Citizenship status
- Residential street address
- ZIP code
To add another owner, click Add Additional Owner. Otherwise, click Next.
Step 7: Provide additional information.
Check Yes or No for the following questions:
- Has the business or any owners included in the application been convicted of a criminal offense related to riots, civil disorder or another disaster? Also, have any been involved in the production or distribution of a product that a court or administrative agency with legal powers has ruled to be obscene?
- Is the business or any owners included in the application currently not allowed to go into a contract with the federal government or receive federal funding?
- Are you facing any criminal charges? Have you been arrested in the past six months for a criminal offense? Have you ever been convicted, pled guilty or nolo contendere, been placed on pretrial diversion or any form of parole or probation, for a criminal offense?
Keep in mind that criminal offenses don’t include minor vehicle violations like parking tickets.
Step 8: Give contact information for anyone who helped.
If you filled the application out on your own, skip this step. But if you signed up for assistance from a bank, SBDC or received any other form of help from an individual, provide the following information:
- Individual’s name
- Name of the company they work for
- Phone number
- Mailing address
- How much you paid them
Check Yes to allow the SBA to contact the person you received assistance from.
Step 9: Provide your bank account information and certify your application.
Provide the following information for the account where you’d like the SBA to send the funds:
- Bank name
- Account number
- Routing number
Then, read the certifications and review the penalties for misapplying the loan. Check the box verifying the information you provided is true. Click Next.
Step 10: Review the summary and submit.
Read over the information you entered on your application to make sure it’s correct. Click the Edit button if you need to make any changes.
Check the box certifying that you’re not a robot and click Submit.
Step 11: Wait to hear back from the SBA for approval
You should receive a notification confirming that you’ve submitted your application, giving you an application number. Take a screenshot of this number or write it down for reference.
Some business owners have reported not receiving a confirmation email. Having your application on hand can make it easier if you reach out to customer service — which can be reached at 800-659-2955 or email@example.com.
The SBA will then notify you through the email address you provided when you’ve been approved or denied.
Can I also apply for an SBA Paycheck Protection Loan?
Yes, you can apply for both the Economic Injury Disaster Loan, and the SBA Paycheck Protection Loan (PPL). If you’re using the EIDL to cover payroll expenses, you’ll have to use the PPL to refinance your EIDL.
Unlike the EIDL, you need to apply for the Paycheck Protection Loan through a lender.
Must read: SBA reopened Paycheck Protection Loan applications
While the SBA closed applications for the Paycheck Protection Program for a time, they are once again open and the deadline to apply has been extended to May 31, 2021.
It can take weeks or even month to see funds after submitting your application. If you need funding immediately, compare loans for businesses affected by the coronavirus or see if your business qualifies for a grant to cover losses during COVID-19 shutdowns.
Apply for a Paycheck Protection Loan today
Below is a list of online lenders offering SBA Paycheck Protection Loans. We recommend applying as soon as possible, since funds are available on a first-come, first-served basis.
The Economic Injury Disaster Loan available to small businesses affected by the coronavirus outbreak has a more streamlined application process than typical SBA disaster loans.
Read our guide on how to finance your business during the coronavirus outbreak for more options. Or, check out our guide to small business loans.
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