Friday is the deadline for small businesses and nonprofits with COVID-19 federal disaster loans to request an increase in their loan amount, officials said.
The U.S. Small Business Administration announced it will accept requests for “a loan increase” under the COVID-19 Economic Injury Disaster Loan program through “May 6 because funding is running out.”
The deadline also applies to requests for a reconsideration of loan applications that were turned down earlier.
The deadline affects borrowers who may be eligible for a larger loan than was available in 2020 and early 2021. At that time, SBA, under then-President Donald Trump, reduced the maximum amount from $2 million per applicant to $150,000 to ensure the funds weren’t exhausted.
The administration of President Joe Biden restored the larger loans after Congress authorized more COVID-19 EIDL funding.
The loans come with a term of up to 30 years and an interest rate of 3.75% for businesses and 2.75% for nonprofits.
Loan proceeds can be used for operating expenses and working capital, such as payroll, equipment purchases and paying debt. Under Biden, borrowers may also use loan funds to prepay commercial debt and make payments on federal business debt.
Separately, SBA announced that COVID-19 EIDL borrowers will no longer have access to loan documents and other information via the application portal, https://bit.ly/3yaRLJm, after May 16.
“Borrowers should download their loan documents from the portal prior to this date,” the agency said on Monday.
More than 3.9 million COVID EIDL loans, totaling $378.4 billion, have been made nationwide since the coronavirus struck more than two years ago. In New York State, there are 339,354 loans, totaling $37.6 billion, the second-most in the country after California, according to agency data as of April 28.
In March, SBA gave borrowers up to 30 months deferment before they have to begin making loan payments. The decision was in response to a request from Sen. Chuck Schumer (D-NY) and supported by 15 other Senate Democrats.
More information about the COVID EIDL is available at https://bit.ly/3y7rxqS or by calling 833-853-5638.
“Although Congressional appropriations for the COVID EIDL program will soon be exhausted, SBA will continue to help our small business owners navigate this challenging transition by utilizing our existing resources to help them grow their business,” the agency said, referring to other assistance options.