A new version of the Economic Injury and Disaster Loan (EIDL) advance is back in place for businesses that are still struggling from impacts of COVID-19. Unfortunately, the EIDL cannot be used to purchase fixed assets. They don’t have to pay it back, and it’s supposed to be disbursed quickly. However, if the business cannot pay the full amount, the lender will foreclose on the collateral pledged by the business. If you received an EIDL between January 31, 2020, and April 3, 2020, and you apply for a forgivable Paycheck Protection Program Loan and then refinance your EIDL into the PPP, you can essentially have your EIDL forgiven. disbursements to owners, unless for performance of services, repayment of stockholder/principal loans (with exceptions), expansion of facilities or acquisition of fixed assets, repair or replacement of physical damages, paying down (including regular installment payments) or paying off loans provided, or owned by another Federal agency (including SBA) or a Small Business Investment Company, payment of any part of a direct Federal debt, (including SBA loans) except IRS obligations, relocation (however, you can request written consent to relocate), ResourcesDataResourcesFAQsPrivacy PolicyTerms of Service, TrackersEIDL Advance TrackerEIDL Loan TrackerBusiness Survival TrackerBank Satisfaction TrackerCOVID Loan Tracker 2.0, Phone: (305) 509-0045 | Email: [email protected]. Can I Use EIDL to Pay Off Debt? No payments are required during the first year but interest ... SBA Loan Number. Way back in March, when the COVID crisis hit, the SBA made EIDL loans available to small businesses injured by the shutdown. With funding still available and a … So if the items that you charged on your credit cards were legitimate business operating expenses, you can use the loan to pay off that portion of your credit card. Qualifying expenses that can be covered using an EIDL include: Working capital Rent Utilities Payroll expenses Fixed debt payments Health care benefits Supplies Inventory Marketing & advertising Accounting & bookkeeping services IRS tax payments If you received both the EIDL loan and the PPP loan, you can identify your EIDL loan by the loan number, the loan amount, or the loan type (“DCI”). I started buying inventory using the money to keep my business afloat as I buy and sell high dollar collectibles , I buy huge collections of rare items in large quantity ! You can use the EIDL to pay some of your recurring regular business expenses, and then use your business regular cash flow to purchase your computer. EIDL payments are deferred for 1 year after the disbursement of the loan, although you may start paying on your loan earlier than this. But I used 2 of my credit cards last year to sustain myself. (The SBA recently reduced that from a $2 million cap.) Unfortunately, the EIDL cannot be used to purchase fixed assets. For businesses that need capital and do not have an issue with requirements, the repayment terms are favorable. It’s really unclear if I’m able to use this money to pay my credit cards and thus lowering my interest rate? SBA Payment Guide and FAQs. With that, it does not need to be repaid. My laptop that I do 100% of my work on is also dying. TYIA. Seems unclear if you’re able to purchase a new computer to conduct work, it’s my only mode of doing work. Unacceptable Uses of PPP Funds Paycheck Protection Program. Businesses can apply directly through the SBA website. All PPP and EIDL loans up to $25,000 don't require collateral or personal guarantees from the business or business owner. Anyone pursuing a PPP loan who already has an EIDL should remember, too, that all PPP allowable costs are allowable EIDL costs, but both loans can’t cover the same expenditures. For more information see below. Loan collateral can include tangible and intangible property like inventory and equipment. In theory, you can pay a couple thousand toward the vehicle via credit card... and pay credit card with EIDL funds. 5 EIDL loan requirements, terms, and conditions you should know. SBA CAFS. The 10-digit SBA loan number and payment amount are required to complete this form. I don’t want anything fancy, but I desperately need a new one! 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