EIDL Loan Reconsiderations and Increases

We found out today that although the White House had successful negotiations with the House of Representatives yesterday, it looks like anything they get done will be dead on arrival in the Senate. Many Senators are facing stiff opposition next month, and the deficit hawks are screaming about an economy that’s already on the skids.
Where does that leave us?
I’m going to be writing extensively about the EIDL Loan Program. $200B is still sitting waiting to be claimed. The SBA has been given a mandate to get as much money out as quickly as possible. Many are screaming that their PPP Loan money has run out.
If you have not applied for this loan and need money, then please apply. Before applying, you may want to read this column and the next few so that you can not make the mistakes that are so common in being rejected. The SBA wants to give you the money. As with all things in lending, you need to not give them a reason to say no.
Many have applied for this loan and been turned down. Many others received the loan, but did not receive the full amount they were entitled to. There isn’t a ton of information out there on either of these subjects. All of this is brand new. It’s also rather confusing if you don’t understand finance or lending. When you have questions, please give me a call.
Supposedly 98% of EIDL (pronounced idle) turndowns are electronic. That’s an important thing to remember. If all we are doing is playing “Beat the Computer”, then all we need to do is play by the rules. Here are the most common reasons that these loans are denied.
1 – Bad Credit
This is a regular 30 year loan. If you have bad credit or no credit, there is a high likelihood that it will be declined. Get your credit report. Pay your bills on time. Improve your score and have the loan reconsidered.
2 – Ownership Does Not Add Up To 100%
When filling out the application, you must put in the information of all of the owners of the enterprise. If you do not put in all, or the ownership percentages do not add up to 100%, the computer will automatically reject the application.
3 – Bad Numbers
If the numbers for gross income and cost of goods sold that you put on the application do not match your income tax return as filed, the machine will reject the application. Don’t guess at these numbers. It’s an easy thing for the machine to check.
4 – Unfiled Income Tax Returns
If your returns have not been filed, then there is no way for the machine to verify anything. As such, it will be automatically rejected. Get your returns in now.
5 – Bad Bank Account Information
If you put in the wrong account or routing number on your application and the machine cannot verify, you’re dead in the water.
6 – Not Verifiable at Secretary of State
If your entity is not current with the Secretary of State, it’s over. Get it renewed and have your loan reconsidered.
7 – Wrong Type of Business
If you are a pot business, a strip joint, or a gambler, you’re not going to get this done. There are others. Go to the SBA Website for further information.
8 – Bad Name
If the name on your Checking Account is Accounting Solutions Ltd. and the name on your application is ASL, the machine is going to bounce you. The same holds true of your Secretary of State file and any other way that they can check you out. DBA’s can get you rejected. Consistency is key.
9 – No Economic Injury
If they can prove that you have not sustained an economic injury, then they will not lend to you.
There is a reconsideration process if you have been denied, not received the full amount, or not received enough to cover your economic injury. This is a complicated process. Reapplying using the same application will not work. I will be writing further about these items in the coming days.
Let me leave you with this.
The Governor of our fair state has once again rolled back the reopening restrictions in DuPage, Kane, Will, and Kankakee Counties. Indoor restaurant and bar service has ended and gatherings are again restricted to 25 people. This affects 1 in 6 residents of Illinois. Also five additional states were added to Chicago’s two week quarantine list.
Here we go again. Just when I thought I was out, they pull me back in.
I don’t have a lot to say. There are those who think that this is necessary, that it will do some sort of good. Others think they are ruining our economy for no good reason.
Where you fall on that continuum may have a lot to do with how you make your living, your age, your health, or your ability to live like a hermit. One thing is certain. This may last longer than anyone originally estimated.
Maintain your mental and regular health. Eat right. Exercise. Spend time with your loved ones. Let your kids go out and play. Get away from your rugrats from time to time. Do something for yourselves. Tell the people you care about how much you love and respect them.
Feed your soul, and know that no matter what happens, we will be right here with you.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. If there is anything you need, whether you are a current client or not, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
Accounting Solutions Ltd.
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