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Can My Economic Injury Disaster Loan (EIDL) & Emergency Advance For Coronavirus Relief Be Forgiven?

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Jared Beilby

Jared Beilby

Jared is a writer hailing from the Pacific Northwest. Besides writing for Merchant Maverick, he has experience writing about sports and video games. He holds a Bachelor of Arts in Journalism from George Fox University.
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14 Comments

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    Ani

    I already applied for my PPP forgiveness and did not mention the EIDL in my PPP forgiveness application. Is there any way to get forgiveness for EIDL with PPP?

      Jessica Dinsmore

      Hi Ani,

      The EIDL loan itself is not forgivable unless you roll it into a PPP loan, a portion of which may be forgivable.

        Becky

        So, I received my EIDL advance of $4000 on 4/29 AFTER my PPP loan. My qualified expenses exceed both. Can I get both forgiven?

          Jessica Dinsmore

          Hi Becky,
          You can use the PPP to refinance the EIDL. Any EIDL money spent on payroll can be forgiven under the PPP (as long as everything is properly documented).

            Michael Karnes

            We received support in three categories…

            PPP…..$20,566.00
            EIDL….$52,500.00
            EIDG….$ 8000.00

            Under the new rules for forgiveness announced on Oct. 8, 2020….this is “supposed” to forgive loans under 50K with a simple form/statement that allows for less paperwork and documentation for loans up to 50K.

            Under Senate Bill 4321, the “Continuing Small Business Recovery and Paycheck Protection Program Act, all PPP borrowers receiving $150,000 or less shall automatically have their loan forgiven if the debtee “signs and submits to the lender an attestation that the eligible recipient made a good faith effort to comply with the requirements under section 7(a)(36) of the Small Business Act (15 U.S.C. 636(a)(36)).”

            What is the status of 4231?

            Right now, small business is being told to “wait and see” what new relief is going to be announced for easy forgiveness….what do you suggest for our situation?

              Jessica Dinsmore

              Hi Michael,

              Forgiveness doesn’t need to be applied for until the maturity date of the loan (which is two to five years down the line) and you have 10 months until after the end of the loan’s service date to apply for forgiveness to avoid losing deferment options (per the SBA’s FAQs), so there’s currently no rush to apply for forgiveness. In the meantime, you can keep an eye on the congress bill tracker for updates.

                Max

                Hello,

                I applied for the PPP but received the EIDL and just now finding out that the EIDL is different from the PPP and is not a loan that is forgiven with the new forgiveness program the government just instituted. What relief exists for EIDL recipients to get our loans forgiven? ANy help would be appreciated.

                Thank you
                Max

                  Jessica Dinsmore

                  Hi Max,

                  That sounds like a very confusing and frustrating situation. If you happened to receive the EIDL Advance/Grant, that portion does not need to be repaid. But the loan portion does, and as far as we know there aren’t any forgiveness options currently available for the EIDL.

                  Best of luck to you.

                    Marlon

                    I know that the repayment is deferred for a year after closing. Do you already incur interest charges prior to the repayment? What if you are able to repay sooner? Would that help as to not pay for finance charges. It’s for a loan of $8000

                      Jessica Dinsmore

                      Hi Marlon,

                      I believe that interest begins accruing immediately (based on what others have reported here), but there is no prepayment penalty. This post explains the rates and fees in more detail. I hope it helps! Best wishes.

                        N Gough

                        How can I find out how much of my EIDL loan is “Emergency Advance” and how much is the “Main Part”? Since the Advance amount is forgivable I really need to know. I logged onto my account with SBA but it does not say.

                          Jessica Dinsmore

                          Hi N,

                          The advance would have been deposited separate from the loan, and it would have come without any “fanfare”. So check your bank deposits and see if you received more than one deposit. It would be the smaller of the two.

                            kimberly simmons

                            Hello Jessica,
                            So my father received $1000 immediately, but then received 9,000 a month or so later. So, he will only have the $1000 dollars forgiven then? I am trying to contact someone there. Thank you…
                            Kim Simmons

                              Jessica Dinsmore

                              Hi Kimberly,

                              That sounds correct. The $1k was likely the advance on a $10k loan, leaving the balance owed at $9k. However, if he also receives a forgivable PPP loan, he may be able to refinance a portion of his EIDL into his PPP, and have the EIDL forgiven that way. If he does this, the $1k advance will be subtracted from the PPP forgiveness amount. I hope that helps!

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