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What the SBA EIDL Loan Document Looks Like (And What to Expect By Email)

hey everyone this is Ryder from skip and

it's Friday May 8th I hope you all are

doing well I want to do a quick and

important video on the sba eid al loan

approval email and dashboard what that

looks like and also important most

importantly what the closing document

looks like there's a lot of progress

being made this week I'll show you that

in a second but so if some of you are

lucky enough and fortunate enough to get

approvals this week you'll need to sign

the eid al loan agreement and i'm so i'm

going to go over that and what you to

look for and some of the some of the

important text in the agreement that you

should know about so thanks again so

much for watching and supporting and and

subscribing means a lot to us let's dive

in so first this is the email we've had

a huge thank you to everyone who's been

keeping us up to date on their status

and sharing this information so well

what i'm going to show you today is

based on what in particular one user

shared with us and we've taken out their

company information etc but this this

will allow us to show you what you can

expect

hopefully for your small business so you

know what to look for before I dive in

though I want to show you very quickly

the data behind this again that that is

being tracked at Hallows capcom it's our

free e-guide e al tracker and we have

free trackers for stimulus unemployment

etc but a little over twelve and a half

percent of skipped users have

self-reported that they have received

part of their advance which is good it's

steadily increasing but here's here's

what's important to note down here this

trend so we always look for the trends

like I mentioned in previous video we

saw this spike up until around the 15th

and 16th of April when they when the SBA

shut off the eid al portal and then we

saw

a drop as they awaited new funding we

saw some increase last week frankly we

expected a lot more but for whatever

reason there wasn't a big increase now

finally and this is this is validated by

a lot of the reports we're seeing a lot

of the reporting saying that e IDL yes

they're processing more the loan

officers are approving more and they're

not accepting new applications so that's

what those are things we're hearing and

what we're seeing here based on our data

that'll you know we're we're starting to

see a lot more applications received and

I expect to see a lot more come in today

this updates in real time and it's still

early in the day here we've already seen

a significant number of people report

that they have received their advances

so what happens after you save your

advance usually a few days later

hopefully you'll get an email to and I

did a video on this yesterday to

basically accept the amount and this

could be the amount that you originally

asked for or up to 150,000 this is the

big news from yesterday that we had

confirmed that the total amounts instead

of being two million which is what the e

IDL program was before the maximum

amount is now a hundred and fifty

thousand so this particular person had

applied for more there are a larger

small business and but their maximum

amount was a hundred and fifty thousand

okay so that's the high end you can

expect and within that you can change if

you want less less than that so I'm

going to show you here when you get this

email like this our loan officer might

email you if they need more information

and that's a good sign right you finally

you had contact with someone who's

advocating for you who wants to push

this larger loan through okay and then

you log into your your sba e IDL

dashboard again and you'll see something

like this this is the person who sent us

their screenshot and

and basically you can see it is much

simpler than the old form right the old

form asked for a lot of materials and

frankly we expected the same but this is

very streamlined and very

straightforward basically you have the

short form that he originally did they

do some checking on documents and

identity and I'm not sure to what extent

they compare to see if you've received

PPP or not I don't know I assume that

they're checking that because the SBA is

you know checking all of these but that

could be you know algorithm give them

the benefit the doubt there that they're

checking to make sure they know who's

getting what and then you sign the

closing documents okay so this is what

I'm going to show you now in detail that

we have seen so it's called the loan

authorization and agreement the laa

again this is directly from the SBA the

person who sent this to us has removed

all of the specific loan number

information name etc so I'll just show

you kind of what what to look for here

yes you do want to read this a lot of

DocuSign things you may be used to just

signing but you need you absolutely need

to take the time to go over this so I'm

gonna just go over and takes a few

minutes it's about 15 pages total but

some of its pretty straightforward so

the top its theme here are the terms and

these are standard terms by the way so

assuming that let's say you you have

gotten that full amount up to the

150,000 again these have been the ideal

terms for years it's a 12-month

repayment from the date the note is

signed and you have 30 years to pay back

and the interest again this has been

standard SBA IDL practice 3.75 percent

for a for-profit

2.75% if you're a non-profit so that's

the interest rate when they do the math

with the new cap the the payments in a

year come out to around 731 per month

okay and there's more on the terms and

collateral if the loan amount is more

than 25 thousand they request collateral

frankly since a lot of this has been

streamlined and changed I'm not sure to

what extent they to what extent this is

in effect now but they've had it in

their documents so for loans of less

than twenty five thousand the SBA is not

taking any collateral okay now a couple

thing is the use of loans right the PPP

is very strict on how you can use it and

that's that's a lot of the question

questions we're seeing now is like

people are worried that they will not be

able to get it forgiven and it will turn

into a loan well even if it does turn

into a loan that's still a low interest

loan so just to keep that in mind there

was a piece that came out today that

showed that actually there was still a

lot of money left in the SBA PPP pot

because a lot of small businesses are

wary of taking the money now just to

want to throw that out there if you

think that you've missed the boat on PPP

if you've watched some of our videos and

read up enough about it and you think

you're interested there is still money

left in the PPP pot okay the the number

of applicants has has decreased

significantly

so requirements the requirements are not

strict like the PPP but obviously like

any business you want to keep your books

clean keep receipts of everything and so

here they say at the top which is most

important obviously keep it itemized

receipts paid receipts invoices canceled

checks and contracts for all loan fund

spent and retain these receipts for

three years from the

the date of the final disbursement okay

so another piece is about relocating you

cannot relocate your business unless you

have written permission from the SBA

okay you know obviously a lot of these

disaster loans have been for wildfires

and hurricanes etc so some of the

language that I'm gonna point out here

is specific to that you know they don't

want you leaving an area they still and

they still also talk about american-made

equipment and products with the proceeds

to the extent feasible purchase only

american-made equipment and products

with the proceeds of this loan and

alright so the deadline again you have

two months from receiving this even

though I think I believe it said on the

portal 30 days but you know you have

some time if you're if you're still

deciding let's say most people want to

sign quickly but just in case your spend

a couple days to think through and plan

plan things out obviously this is still

alone it's still tied to you and your

business so you need to take it

seriously and and think through your

ability to repay just like any other

loan with a private lender so I'm gonna

I'm going to scroll down here to this

part your duty to maintain hazard

insurance which is interesting again

this is probably a holdover from the

traditional use of these loans in

response to hurricanes wildfires I do

not know to what extent this is

applicable now because you know I'm not

sure you can get hazard insurance for

pandemics right so you know and what it

says here has

insurance policy including fire

lightning Senate coverage again so much

of this is for you know kind of geared

towards natural disasters anyway general

bookkeeping information how to keep good

books but if you have a good bookkeeping

practice in general you should you

shouldn't have a problem but but you

need to read all all of this and let's

see here there are some certifications

to namely to make sure that nothing has

changed substantially since the original

application right that could be like

judgment liens or tax liens or

bankruptcy it cetera things like that

and a few other certifications that you

know specifically about like other

claims or applications related to the

disaster and delinquency type type

questions too so you obviously want to

read through those and and then there's

the dispersment the support of the loan

which you can take a look at i'm just

going to jump down here to the and it's

signed by the associate administrator of

the SBA and i'm gonna jump down here to

lobbying so if this is a loan over a

hundred fifty thousand which now is not

possible based on our understanding but

if it was then you'd have to certify

that you're not going to use any of the

funds towards lobbying i'm going to

scroll down to the actual note itself

and there's a couple equal opportunity

Equal Employment Opportunity

notifications in English and in Spanish

okay and then there's the note again

it's straightforward just recaps

everything and

the repayment etc so obviously you want

to read through that as well and the

SBA's general powers what happens in the

case of delinquency etc which are common

to other loan terms as well there was

nothing that seemed to vary

significantly from other loan documents

we've seen and there's the security

agreement as well so it's it's not too

complicated of a document to go through

but just wanted to show you that of

course and and give you a heads up again

the trend we're seeing here is pointing

to a good sign that once the advance

hits there's some time between the

advance and the the larger idea alone

but it does seem like from the things

we're hearing the reports and the data

that things are happening so thanks

again for watching I hope this is

helpful to go over that note document

and some of the things to look for and

if you have any questions leave comments

thanks so much stay safe and stay home

take care