How to Calculate Your Eidl Loan Amount

Eidl Loans can provide vital financial assistance to small businesses during the COVID-19 pandemic. This blog post will show you how to calculate your loan amount so that you can get the most out of this program.

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What is an EIDL Loan?

The EIDL Loan program is a federal disaster relief loan program that provides low-interest loans to small businesses and nonprofit organizations that have been severely impacted by a disaster. The SBA offers EIDL Loans of up to $2 million to help businesses and nonprofits recover from the financial impact of a disaster. The interest rate for EIDL Loans is 3.75% for small businesses and 2.75% for nonprofits. EIDL Loans can be used to cover a variety of expenses, including working capital, inventory, payroll, and other operating expenses.

To be eligible for an EIDL Loan, your business must be located in a declared disaster area and must have suffered substantial economic injury as a result of the disaster. You do not need to be a homeowner or have property damage to be eligible for an EIDL Loan. You can apply for an EIDL Loan online through the SBA’s Disaster Loan Application portal.

How to Calculate Your EIDL Loan Amount

The EIDL loan amount is determined by your business’s financial needs. The SBA will consider your business’s revenue, expenses, and cash flow to determine how much you can borrow. You can use the EIDL loan calculator to estimate your loan amount.

Step One: Determine Your Business’ Physical Location

To calculate your EIDL loan amount, you first need to determine your business’ physical location. You can use the following methods to do this:

-Look up your business’ address in the U.S. Census Bureau’s Geocoder tool.
-Enter your business’ ZIP code in the U.S. Small Business Administration’s EIDL Loan Calculator.
-If you have multiple locations, you will need to calculate the EIDL loan amount for each one separately.

Step Two: Find Your Business’ Average Gross Receipts
Once you know your business’ physical location, you can find its average gross receipts over the past two years. You can do this by looking at your company’s tax returns, financial statements, or accounting records.

If you don’t have two years of records, you can use one of the following methods to estimate your average gross receipts:

-Look up your industry’s average gross receipts in the North American Industry Classification System (NAICS).
-Use the SBA’s EIDL Loan Calculator to estimate your average gross receipts based on your business size and type.

Step Three: Calculate Your Maximum EIDL Loan Amount
The maximum EIDL loan amount is determined by multiplying your business’ average gross receipts by 2.5. To calculate this, simply multiply your average gross receipts by 2.5. For example, if your company had an average of $100,000 in gross receipts over the past two years, its maximum EIDL loan amount would be $250,000 (($100,000 x 2.5) = $250,000).

Step Two: Decide the Purpose of Your Loan

Now that you know how much you can borrow, it’s time to decide what you will use your loan for. The Small Business Administration (SBA) offers the EIDL for a variety of purposes, including:
-To provide small businesses with working capital during the COVID-19 pandemic
-To help small businesses meet payroll and other expenses
-To pay fixed debts, payroll, accounts payable and other expenses that can’t be paid because of the disaster’s impact

The SBA offers two different types of EIDLs: one for business purposes and one for agricultural purposes. If you’re not sure which type of loan is right for you, the SBA offers a Loan Eligibility Wizard on its website that can help you determine which type of loan you should apply for.

Once you know what purpose your loan will serve, it’s time to calculate how much money you will need to borrow. This number will be your loan amount.

Step Three: Find Your Business’ Average Monthly Payroll Costs

To find your business’ average monthly payroll costs:

1. Add up your total payroll costs for the past 12 months. This should include salary, wages, tips, paid leave, health insurance, retirement benefits, and state and local taxes imposed on employee compensation.

2. Divide the total by 12 to find your average monthly payroll costs.

3. If your business has been in operation for less than 12 months, you can use an alternate method to calculate your average monthly payroll costs. To do this, add up your total payroll costs for the time period you’ve been in operation and divide by the number of months you’ve been open.

Step Four: Calculate Your Maximum Loan Amount

The SBA’s Economic Injury Disaster Loan (EIDL) program provides small businesses and nonprofits with working capital loans of up to $2 million to help overcome the temporary loss of revenue they are experiencing as a result of the coronavirus (COVID-19) pandemic.

If you have already applied for an EIDL and been approved, you may have received a loan offer from the SBA. The loan offer will include an amount for you to accept or decline. But how did the SBA arrive at that number?

Here is a step-by-step guide on how to calculate your EIDL loan amount so that you can be sure you are getting the maximum amount of financial assistance possible.

Step One: Determine Your Eligible Loan Amount
To calculate your maximum loan amount, the SBA will take into account your business’s financial information for the past year, including:

-Your gross revenues
-Your expenses
-Your total debts

How to Use Your EIDL Loan

The Economic Injury Disaster Loan (EIDL) is a loan available to small businesses and private non-profit organizations that have suffered substantial economic injury as a result of the coronavirus (COVID-19) pandemic. The EIDL loan can be used to pay fixed debts, payroll, accounts payable, and other bills that can’t be paid because of the disaster’s impact.

Step One: Determine How Much You Need to Borrow

The first step in using your EIDL loan is to determine how much you need to borrow. You can do this by calculating your total eligible costs, which include:

-Employee salaries
-Rent or mortgage payments
-Insurance payments
-Utility bills
-Inventory costs
-Other operational expenses

Step Two: Choose a Repayment Plan

Now that you have applied for and been approved for an EIDL loan, it is time to choose a repayment plan. To do so, you will need to login to your SBA account and select ‘Repayment Plans’ from the left-hand sidebar.

From there, you will be able to see all of the different repayment options that are available to you. The three primary repayment plans are as follows:

Pay As You Go: With this option, you will begin making payments on your loan as soon as the funds are disbursed. This is a good option if you have the cash flow to make the payments and do not want to accrue interest on your loan.

Deferred Payment Plan: With this option, you can defer making payments on your loan for up to 12 months. This is a good option if you need some time to get your business up and running before you begin making payments on your loan.

Interest Only Payment Plan: With this option, you will only be responsible for paying the interest on your loan for up to 12 months. This is a good option if you want to minimize your monthly payment but still want to begin paying down your principal balance.

Once you have selected a repayment plan, you will be able to see your estimated monthly payment amount. You can also adjust this amount by changing the number of years that you would like to repay your loan.

If at any point during the life of your loan you need to change your repayment plan, you can do so by logging into your account and selecting ‘Repayment Plans’ from the left-hand sidebar.

Step Three: Begin Making Payments

The SBA will contact you to begin making payments on your EIDL loan. You will have up to 30 years to repay your loan, and you can make payments at any time without penalty. The SBA offers several repayment options, so you can choose the option that best fits your needs.

You can make payments online, by mail, or by phone. To make a payment online, log in to your account on the SBA website and select “Make a Payment.” If you need help making a payment, call the SBA Customer Service Center at 1-800-659-2955 (TTY: 1-800-877-8339).

What to Do if You Can’t Afford Your EIDL Loan

If you’re like most people, you probably don’t have a lot of extra money sitting around. So, what do you do if you can’t afford your EIDL loan? The first thing you should do is call your lender and explain your situation. They may be able to work with you to find a solution.

Step One: Talk to Your Lender

If you’re struggling to make your loan payments, the first thing you should do is reach out to your lender. They may be able to offer you a different repayment plan or deferment options. Deferring your loan means that you don’t have to make payments for a set period of time, which can give you some breathing room if you’re going through a difficult financial period.

Step Two: Create a Repayment Plan

If you can’t afford your EIDL loan, you have a few options. You can either negotiate a repayment plan with the SBA or try to get the loan forgiven.

If you want to try to get the loan forgiven, you’ll need to write a hardship letter explaining why you can’t afford the loan and what you’ve done to try to improve your financial situation. You’ll also need to provide documentation showing your financial difficulty.

If you decide to create a repayment plan, you’ll need to figure out how much you can afford to pay each month. You’ll also need to make sure that the payments are affordable for the long term. To do this, you can use a repayment calculator like the one on the SBA website.

Once you’ve figured out how much you can afford to pay each month, you’ll need to contact the SBA and negotiate a repayment plan. The SBA will then send you a promissory note outlining the terms of the repayment plan.

If you’re having trouble making your payments, you can contact the SBA for help. The SBA has several programs available that can help you lower your monthly payments or get forgiveness for part of your loan.

Step Three: Consider Refinancing Your Loan

If you have other loans, you may be able to lower your monthly payments by refinancing your Eidl loan. You can refinance your Eidl loan through a lender that offers SBA 7(a) loans. When you refinance, you’ll need to reapply and go through the approval process again.