There’s some good news for any business that took out a COVID Economic Injury Disaster Loan (EIDL). The Small Business Administration is extending deferment periods for disaster loans once again.
With no further COVID-related relief funds from Congress in sight, the SBA is allowing those who sought disaster loans from the COVID-relief program to extend the deferment period for 30 months from when the loan was first approved. Those seeking this deferment will still need to pay interest — around 3 percent — on the loans, which is generally considered inexpensive. {mprestriction ids="1,3"}
The extension applies to all EIDL loans approved since 2020. Some disaster loans previously had deferment periods for either 18 months or 24 months. SBA Administrator Isabel Guzman said in a statement that the extended deferment for the loans will help millions of small-business owners.
The EIDL program has dispensed more than $351 billion worth of relief to nearly 4 million borrowers, according to the SBA.
“There are still small businesses here in Utah that are struggling to get back to pre-COVID revenues,” said Marla Trollan, SBA Utah District director. “This additional deferment will help them manage their cash flow as they get back on their feet. We have come a long way since the start of COVID but many of our Utah businesses are still struggling.”
The SBA said that borrowers may make partial or full payments during the deferment period but are not required to. The SBA recommends using www.pay.gov to make any payments. The SBA said it will not send monthly SBA Form 1201 payment notices; however, the SBA will send regular payment reminders via email.
Existing COVID EIDL borrowers can find account balances and payment due dates in the SBA Capital Access Financial System (CAFS) and learn how to set up an account in the CAFS system by logging in at sba.gov. The SBA also warned that deferments may result in balloon payments.
After the deferment period ends, EIDL borrowers will be required to make regular principal and interest payments beginning 30 months from the date of the note.{/mprestriction}
