SBA Targeted EIDL Advance Grants: Do You Qualify?

How much money will you need to protect your business during the pandemic? Does your business need $50,000? $100,000? $500,000 or even $2 million? Whatever the amount, the SBA has you covered with its targeted EIDL Advance Grant program. It provides financing to businesses that demonstrate economic loss and are already receiving an SBA-guaranteed loan.

EIDL Advance vs Loan: What’s the Difference?

The first thing to know about SBA loans is that you must pay them back. Not so with EIDL advances. The good news is they’re not loans but grants paid out as a one-time payment that you never have to pay back.

Who Is Eligible for This Loan?

The Small Business Administration’s (SBA) targeted Economic Injury Disaster Loan (EIDL) program provides funding as soon as possible for businesses affected by the global pandemic. This option is perfect for businesses that cannot access traditional credit markets due to economic distress caused by a recent disaster event. Here are some qualifications:

Are You Located in a Low-Income Community?

If your business’s location is in a low-income community, you may qualify for an additional grant of up to $500,000. If your business meets these criteria, submit your application via email and indicate that you meet these additional grant criteria. Federal agencies will review your eligibility and notify you if they approve an additional grant of up to $500,000 on top of what you would otherwise be eligible to receive.

Has Your Business Suffered an Economic Loss Greater Than 30%?

If you’re a small business owner that’s been affected by a natural disaster or a catastrophic event, it makes you eligible to receive a one-time payment from a Small Business Administration (SBA) program. This money can help you replace inventory, equipment, and fixtures. Get started on your recovery today with an application to SBA’s Economic Injury Disaster Loan (EIDL) program.

Do You Employ Less Than 300 Employees?

If you employ more than 300 full-time employees at your business, you are not eligible to apply for an EIDL Advance. If you employ up to 300 full-time employees, your loan size must be less than $3 million. Businesses that have less than $15 million in assets are also considered small businesses under current Small Business Administration guidelines, which determine eligibility for most federal contracting programs.

Do Individuals Operating as a Sole Proprietorship Qualify for an SBA Targeted EIDL Advance Grant?

According to Lantern by SoFi, “If you are an individual who operates as a sole proprietorship, you may be eligible to receive an SBA-guaranteed advance.” You may even qualify for a non-guaranteed 5(2)E or 5(2)F lending option with specific dollar amounts available to your business. Both programs allow loans ranging from $1,000-$35,000. The interest rate on your loan for both the programs differ as well. To qualify for the advance, you can be an independent contractor without employees, a small agricultural cooperative, or a private non-profit.

If you qualify for an EIDL grant, make sure you go after it. As long as your business was already up and running no later than January 31, 2020, the SBA advance can help jumpstart your business in ways other financing options simply cannot. However, this isn’t something you should tackle alone—take advantage of all available resources to ensure your success. To get more information, contact a customer service representative at Lantern by SoFi.

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