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What SBA Disaster Loans Are & How To Qualify For One

    Chris Motola
  • Updated on:
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Chris Motola

Chris Motola

Expert Analyst & Reviewer at Merchant Maverick
An expert in personal and business loans and financial health, Chris Motola has been writing about small business finance and payments for over 5 years. He has been cited in various industry publications, including Forbes Advisor, GoBankingRates, and Medium. Chris is a graduate of the University of Central Florida.
Chris Motola
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    how do they expect you to have current credit when you’re in a disaster (pandemic) self-employed workers can’t work. my credit is shot, so I can’t get any relief to help rebuild my business. Sounds like more money for those that have money or actually weren’t affected by the pandemic. If there is a long term low-interest loan out there that is really for those affected please send me a link to the site to apply.

      Jessica Dinsmore

      Hi Padric,

      The SBA will perform a credit check on your accounts. While you need to show you have regularly made payments on accounts, you don’t need to be too concerned if you have a few negative marks on your credit report as long as the majority of your accounts are in good standing with the reporting agencies. You could certainly apply for PPP/EIDL funds as well. They offer a fair amount of flexibility in regard to creditworthiness, and there is no specific minimum score stated. Basically, they want to see that you were relatively good at making timely payments pre-pandemic. I hope that helps!

        Alex E

        Hi, It’s EIDL still available? If yes can I still apply on behalf of my business if I have bad credit? Thanks

          Jessica Dinsmore

          Hi Alex,

          Yes according to the SBA’s website the EIDL loan is available, but the advance/grant program is not. The SBA does not use your credit score but looks for delinquencies and other derogatory remarks that help them determine your creditworthiness.


            I didn’t get any information. I’ve tried everything.

              Jessica Dinsmore

              Hi Marlon,
              What information are you looking for? Maybe we can help point you in the right direction.


                Hi Merchant Maverick, Thank you for all the information, very helpful.
                I hope you can help me or someone else can identify with my case. We got the 10k and fortunately the EIDL loan was accepted for my company. The problem is that we were eligible for 100k , everything was right, our papers were right, score, and they are giving us half of the amount that we requested. Is it happening with someone else? What should be the reason for them to reduce the amount if we are eligible to get more money? What do you recommend us to do?

                Thank you

                  Jessica Dinsmore

                  Hi Carla,

                  You are definitely not the only one experiencing this. We’ve just added this question to our FAQ section as well.

                  The SBA uses this formula to calculate how large of an EIDL loan standard small businesses are eligible for:

                  Revenue minus COGS, divided by 2, minus the advance (capped at $150K).

                  It is possible that you inputted the wrong amount for your revenue or COGS. Assuming you have not yet accepted the loan offer in the portal, you can still request to revise these numbers if you think they are incorrect and are not happy with the amount—start this process by calling Tier 2 support. Make sure you have documentation to back up your numbers, including tax returns and P&L statements.

                  If you already accepted a loan offer, it’s unfortunately too late to revise your application, as currently no loan modifications are allowed.

                    Angela Booker

                    I’m wanting to check the status on SBA PPP for Alterations in a hurry and dry cleaners in Shreveport, La. Thanking you in advance.

                    Angela Booker

                      Jessica Dinsmore

                      Hi Angela,

                      We have a post that explains how to check the status. Good luck!


                        I am 1099 or independent contractor i apply for EIDL and i work under LLC but i am not the owner for that business, SBA email me said they unable locate your file with the information you provided. What do i do?

                          Jessica Dinsmore


                          You may have better luck applying for a PPP loan for self-employed individuals or even Pandemic Unemployment Assistance.

                            Angel R. Butler

                            None of the SBA relief loans are EASY, what about microloans/businesses with bad credit, i have a yearly revenue of about 20k due to very low income and forced to take “legal” high interest loans/debts, i can’t make it 3 days let alone 3 weeks, but i have always managed to pay the basics, until now… I really don’t know how my son and i are going to get/survive this… Hope everyone stays home, stay healthy

                              Jessica Dinsmore

                              Hi Angela,

                              Funding Circle may be an option for you. They don’t list a minimum annual revenue requirement and require a personal credit score of 660. Depending on what your personal credit score is, you may also want to look into personal loans for business. You can also look into CDFI‘s, which offer microloans and other financial products. These may be easier to qualify for, but (like SBA loans) can take some time to actually receive. If you have any existing relationships with any banks or lenders, you can even talk to them about what options are available to you in terms of new loans or existing accounts. I hope that helps. We wish you all the best!

                                Linda Baham

                                I only need $25k I don’t see much encouragement from SBA.

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