The SBA recently increased the maximum amount that small businesses can borrow through the EIDL program. Previously, the SBA had a cap of $150,000 for six months of economic injury caused by COVID-19. This significant increase now allows borrows to increase their loan up to $500,000 for twenty-four months of economic injury cause by COVID-19. This change took effect on April 6, 2021, meaning businesses that are eligible can request to increase their limit now.
How Can I Increase my Existing EIDL Loan?
If you have an existing loan that is subject to the $150,000 limit, the SBA will reach out directly to businesses via email to provide instructions on how to request an increase. Due to a high demand for increases, it may take several weeks for the SBA to respond. If your business initially accepted a loan for less amount than what was offered, your business has up to two years after the date of the promissory note to request an increase for additional funds.
Any new applications or applications that are currently be processed will automatically be considered for the twenty-four month, $500,000 limit.
Will I Need to Submit Additional Documentation to Increase my Loan Amount?
Should the SBA need any additional information or documentation to increase your already existing EIDL loan, they will request it in response to your increase request. You should not send any sensitive financial information in your initial increase request. You should include identifying information such as your application number, loan number, company name, business owners’ names, business address, and phone number in your request to increase your loan amount.
Extended Deferment Period for EIDL Loans
The SBA also recently announced that it is extending the due date of first payments until 2022 to give businesses more time to bounce back from continued shut downs. However, interest will continue to accrue on the loan. Additionally, receiving a loan increase will not further extend the due date of the first payment.