The COVID EIDL hardship program finished on March 19, 2025. If you cannot afford your EIDL payments, you can still contact the EIDL servicing center. Servicing requests are now submitted by email to CESC@sba.gov.
If you cannot repay in full, you may be able to negotiate a lesser settlement amount through a program called Offer in Compromise. This is like what the IRS does. You want to hire an experienced professional to represent you in the Offer process.
SBA’s COVID EIDL Loan
A lifeline it was for those who received the EIDL money, more than 3.9 million businesses, per SBA. This loan had great terms: 3.75% interest rate, long repayment terms of 30 years.
One of the remarkable terms of the SBA’s COVID EIDL program was the very long period that payments could be deferred for: up to 30 months. Deferrals have ended.
The EIDL loans require repayment. These are not forgiven, unlike PPP loans. EIDL is a loan, not a grant. EIDL Targeted Grants are grants, that need not be repaid.
You may not be making a profit yet, or maybe sales have fallen since the pandemic. You can’t always keep up with SBA loan payments if you have not yet recovered. Even closed businesses still owe the money. COVID EIDL loans under $200,000 required no personal guarantee from owners. Larger loans did.
Hardship Accommodation Plans
Hardship accommodation plans, while they lasted, kept many SBA loan holders in good standing on their EIDL loans.
Here’s how it used to be, when applications were accepted.
SBA offered hardship accommodations for EIDL borrowers who could not afford to pay the regular monthly installments. Here’s how it worked:
- Make a payment of at least 10% of regular monthly payment, not less than $25 each month, for 6 months. You could pay as much or as little as you want, over and above the minimum.
- After the six months, borrowers must resume full regular payments.
- Remember that EIDL interest accrues until you pay off the loan. The outstanding balance grows over time. Term stays at 30 years, so you could face a big balloon payment at the end. There are calculators to figure out SBA loan balloon payments.
Enrollment steps for borrowers differed by loan size, but always began 60 days before the first payment due date.
Borrowers with loans under $200,000 could access the CAFS platform through the MySBA Loan Portal (lending.sba.gov). Go to the Loan Summaries page.
SBA loan payments are generally not credit reportable. This means the SBA hardship plan, by itself, may not be damaging. But if the loan went for over $25,000 and a UCC filing was made on the loan, other lenders may see it and stop a new loan.
Low-cost SBA Resources
In the face of an economic downturn, every business needs a mentor to help with strategy. SBA partners with local SCORE chapters and Small Business Development Centers around the country to offer free and low-cost counseling and mentoring.
SBA’s EIDL program provided funding when small businesses needed it most. Affordable rate and favorable 30-year term will ensure it is one of the great small business loans of our times.
The economic hardship accommodation program, while it lasted, worked well as a temporary stopgap measure. Ultimately, however, the program was never intended as a permanent solution. Interest kept accruing, and borrowers needed to make at least regular payments again.
Meanwhile, you can take advantage of low-cost SBA resources. SBA partners offer a range of valuable resources, including mentoring programs, expert advice, and tailored support. These services can improve your chances of success.
About Delancey Street
Delancey Street is a premier, and award winning, business debt settlement company that helps business owners nationwide. Our goal is simple: help you escape debt in a safe and legal manner. Based out of New York, we can help in 49 of 50 states. We tell you how it is; because your business and future is on the line.
