b'NEWSWIRE:SBA Tweaks COVID-19 EIDL Program to Make it More AttractiveP assenger vessel operators still strugglingPrevious features of EIDL that remain in business expenses) and the debt payments toovercomeeconomichardshipforce are:mentioned above;inflicted by the coronavirus pandemic The loan period is for 30 years;Collateral is required for a loan of $25,000 may wish to take advantage of the U.S. Small or more, and a personal guaranty is Business Administrations COVID-19 EIDL The interest rate for a business is 3.75 required for a loan of $200,000 or more; and(EconomicInjuryDisasterLoan)program. percent. For a private nonprofit, it is This option is possibly available even if the 2.75 percent;There is no penalty for prepayment small business has previously received other Allowable uses include working capital andof the loan.federal COVID-19 economic relief. If this is normal operating expenses (payroll, rent orMore information can be found at the of interest, dont delay as the program will end mortgage, utilities, inventory, other ordinarySBAs COVID-19 EIDL web page. by Dec. 31 or possibly even earlier if available funds are exhausted. Normally used to assist small businesses cope with natural disasters such as floods, wildfires, andhurricanes,theprogramsscopewas expanded last year to include economic injury relatedtothepandemic.Thisexpansionis known as the COVID-19 EIDL program.Keep in mind that EIDL proceeds must be paid back. They are not potentially forgivable (aswerePayrollProtectionProgramloans), nor are they a grant (like funds obtained from the Restaurant Revitalization Fund or under the Treasury Departments CERTS program). Aborrowermustdemonstratealevelof creditworthiness. Nonetheless, the loan terms are sufficiently favorable that a small business wouldbeprudenttolookintowhetherit might make sense to take advantage of EIDL.In early September, SBA announced changes to COVID-19 EIDL to make it more attractive to qualified borrowers. These changes include: The maximum loan size has been raisedfrom $500,000 to $2,000,000; Funds can be used to pre-pay commercialdebt or satisfy regular commercialdebt payments (especially helpful if thecommercial debt, such as business creditcard debt, has a higher interest rate). EIDLproceeds can also be used to makeregularly-scheduled payments of federaldebt; and For the first two years of the loan, nopayments are required (although interestaccrues during this period). This meansthat the loan will be paid back during thefollowing 28 years. For an existing EIDLborrower with a shorter deferral term, anadjustment will be made.OCTOBER 2021 45 NEWSWIRE'