While the Paycheck Protection Program (PPP) gained a high profile during the prolonged COVID-19 pandemic, it was not the only program offering financial relief to struggling small businesses. The SBA’s Economic Injury Disaster Loan (EIDL) program approved in excess of $200 billion in COVID-19 EIDL loans to more than 3.7 million small businesses and not-for-profit organizations. The loans have a 30-year maturity with interest rates of 3.75% for small businesses and 2.75% for not-for-profits.
Originally, the EIDL loans offered a 12-month deferment until the first principal and interest payment was due for all loans made in 2020 or 2021. But the SBA recently announced an extension on the initial payment dates:
- For all SBA disaster loans made through December 31, 2020, the first payment due date is 24 months (extended from 12 months) from the date of the note.
- For all SBA disaster loans made in 2021, the first payment due date is 18 months (extended from 12 months) from the date of the note.
Borrowers may choose to voluntarily make payments during the deferment, as interest will continue to accrue on the outstanding loan balance during this period.
For additional information about the EIDL loan program, PPP program or other sources of pandemic relief funding, please contact Gray, Gray & Gray at (781) 407-0300.
