✅Do you know what you are signing up for when you accept the EIDL loan? Find out in this video!
DISCLAIMER: please note that the information contained in this video is for educational and entertainment purposes only. You should always consult your own attorney and your own financial and tax advisors before making any legal or financial decisions. This video is not intended to and does not create any attorney-client relationship between the content creator and the viewer. The views and opinions expressed in this video belong solely to the creator and do not reflect those of his law firm or any of his business partners.
My attorney profile and contact information:
The complete EIDL playlist:
Time Stamps for this Video:
3:20 – Main terms (number of years, interest rate, 12-month deferment) in the Loan Authorization and Agreement Document
4:55 – Interest accrues during 12-month deferment
9:05 – Collateral and SBA’s lien against it
13:43 – Restrictions on sale of your business assets
15:05 – Permissible use of loan proceeds (discussion regarding the meaning of “working capital”)
20:15 – Record-keeping regarding use of loan proceeds
20:34 – Restriction on using loan proceeds to relocate your business
24:50 – Compensation from other sources
27:28 – Requirement to obtain “hazard insurance” for your assets (when the assets are used as collateral by the SBA)
28:40 – Additional requirements to maintain books and records and to report to the SBA
30:55 – Limits on distribution of assets
32:52 – Borrower certifications
35:45 – Civil and criminal penalties that accompany violations of the loan provisions
37:59 – Various miscellaneous provisions
39:26 – The Promissory Note
My real estate brokerage:
There are numerous hidden and not-so-hidden provisions in the Economic Injury Disaster Loan (“EIDL”) program loan documents. If you defer your payments for the first 12 months, interest will continue to accrue and will be capitalized into your loan. If you borrow more than $25,000, the Small Business Administration (“SBA”) will obtain a collateral lien against all of your business assets. If you misuse the funds, provide inaccurate information, etc., you may be charged as much as 3 times the loan amount and may be subject to criminal penalties and civil fines. Watch the full video for a complete breakdown of what is included in your loan documents!
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