The U.S. Small Business Administration didn’t resume accepting applications for disaster loans on Monday because the additional money authorized by Congress could be exhausted by previous applicants, agency officials confirmed.
“The SBA is unable to accept new applications at this time for COVID-19 Economic Injury Disaster Loan-related assistance…based upon available appropriations funding,” said Matt Coleman, a spokesman for SBA’s Region II, which includes New York State.
“Applicants who have already submitted their applications will continue to be processed on a first come, first serve basis,” he said on Monday.
EIDL loans are up to $2 million per applicant, with an interest rate of 3.75% and a 30-year term.
President Donald Trump signed into law last week a bill adding $60 billion for EIDL, where the funds are distributed by the U.S. Treasury Department. An earlier allocation of $17 billion was exhausted on April 16 and the SBA stopped taking new applications after receiving more than five million, according to an agency official.
Another SBA program, the Paycheck Protection Program, received $310 billion in additional federal loan guarantees in the new law. Coleman said SBA resumed reviewing those loans, which are made by banks and other private lenders, at 10:30 a.m. on Monday.
Some banks complained they couldn't submit all their PPP applications to SBA's system for processing and approving loans. The agency notified lenders on Sunday that it was limiting the number of applications that can be submitted at any given time.
SBA administrator Jovita Carranza tweeted the agency "has processed more than 10,000 #PaycheckProtectionProgram loans submitted by more than 4,000 lenders" in five hours on Monday. "There are double the number of users accessing the system compared to any previous day during the first round of #PaycheckProtectionProgram funding," she said.
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