Update On the SBA COVID Disaster Loan Extension
At Cove Professional Services, we’re constantly staying up to date on the latest news and changes to tax law and other government agencies that impact your business. And with the newest announcement from the Small Business Administration on the COVID Disaster loan extension, we wanted to take a moment and give you some key highlights to be aware of, especially when it comes to the new processing time for disaster loan modifications of 45 days.
Here are some other key highlights and takeaways from the latest announcement from the Small Business Administration:
COVID EIDL CAP. INCREASE
The SBA will elevate the COVID EIDL cap that’s currently at $500,000 to $2 million. This means loan funds can be used for any normal operating expenses as well as working capital, including payroll, purchasing equipment, and paying debt.
A NEW DEFERRED PAYMENT PERIOD.
They’ve ensured small business owners won’t have to begin COVID EIDL repayment until two years after their loan started. This way, you can get through the pandemic without having to worry about making your business finances work.
ESTABLISHED A 30-DAY EXCLUSIVITY WINDOW.
This is designed to ensure that small businesses have additional time to access the funds, and to do so, they’ve implemented a 30-day exclusivity window of approving and disbursing funds for loans of $500,000 or less.
EXPANDED ELIGIBLE USE OF FUNDS.
Your COVID EIDL funds are now eligible to prepay any commercial debt and make payments on your federal business debt as well.
SIMPLIFIED AFFILIATION REQUIREMENTS.
To help make the application process for COVID EIDL small business loans, the SBA created more simplified affiliation requirements that are closely modeled around the Restaurant Revitalization Fund.