Paycheck Protection Program vs. Economic Injury Disaster Loans

PPP vs EIDL

Small Business Act	Paycheck Protection Program (aka Forgiveness Loan Primarily for Payroll)	Economic Injury Disaster Loans (aka Disaster Relief Loan)
Loan Forgiveness	Yes	No
Eligibility	Businesses, Non-profits, Self Employed, Independent Contractors, GIG economy workers	Businesses, Sole Proprietors, ESOPs, Non-Profits, Independent Contractors
Loan Terms	2 years at .5%	Up to 30 years We expect 7-15 years will be normal 3.75% Rate – Business 2.75% Rate – Non Profits
Deferment	5-12 months	5-12 months If you have a current loan, there is a 6 month payment deferment
Underwriting Requirements	Easy processing, less paperwork, fast processing Verify in business as of 2/15/2020 Less than 500 (can have more) without an aggregation Should have a loan package with letter No Collateral required	Stringent Requirements, more paperwork, slower processing Emergency Grant of $10,000 if requested Business in existence for more than one year Less than 500 employees Show proof of hardship (financials) Should have projections Must have ability to repay – 640 credit score
Personal Guarantee	No	Yes
Emergency Grant	No	Yes – $10,000 available within 3 days if requested If you have already applied, then you must “re-apply” for the $10,000 grant
Loan Amount	Lessor of: Average monthly payroll for prior year x 2.5 Confirm you use the right definition of “payroll costs” or $10,000,000	Determined by SBA Can be negotiated Up to $2,000,000
Loan Forgiveness	Must spend the money during the first 8 weeks after issuance on: Payroll costs Rent & Mortgage Interest Health Insurance (normally paid by company only) Retirement Costs Utilities (water, gas, internet, telephone) Must document properly	No forgiveness $10,000 grant if requested
When is it available?	Expected 4/7/2020 or 4/13/2020 Goal is to make this fast Same day or next day	Apply now – takes 3 weeks to get
Application end date	6/30/2020	12/31/2020 – expected to change

Note that this is a new bill. While we understand the bill and what’s in it, the implementation by the government and banks may change. The information on this page may be updated without notice.