Step-by-Step Guide On How EIDL Loans Are Being Approved Now
As reported last week, the SBA increased its capacity to process EIDL loans from under 2,000 per day to nearly 40,000 per day. With this increase, they have reportedly worked through more loans in the last few weeks than they did in the seven months prior. The SBA expects to process all EIDL loans in the next 2-3 weeks.
In an exclusive interview, we spoke with an SBA loan officer who shared important details on EIDL loan processing — specifically on the improvements that resulted in their ability to process 20x more loans per day. Here is a step-by-step guide to those changes in the EIDL loan process with a step-by-step video below.
Half a Million People Are Still Waiting for EIDL Loan Decisions
According to the SBA's data last week, over 600k EIDL loans have yet to be processed. They have reportedly increased their loan processing capability to over 37,000 per day. Our SBA contact said that the SBA wants to approve everyone, but they have a checklist to follow.
If you've been denied, you can apply for reconsideration. If you do apply for reconsideration, ensure the information on your application matches your IRS tax forms, as this has been a major reason for denial. You can always contact your local SBA District Office with specific questions and guidance.
The Old SBA EIDL Loan Review Process
Before July 1, 2021, the SBA had a lengthy 20-step review process for each application. This cumbersome process is one of the main culprits for the untimely decisions, as loan officers could only process 1-2 loans per day.
Once a loan officer received an application, they had to make an introductory phone call to the applicant, review the documentation multiple times, and then call and email the borrower again if more documentation was required. Applicants were given seven days to respond to the loan officer's call and email before it was withdrawn.
These call exchanges were a big reason loan officers were typically unable to process more than two loans per day. Understandably, applicants wanted to speak (vent) to the loan officers about their applications, but this prevented officers from moving on to other loans. The seven-day waiting period for an applicant to respond also slowed down the entire process.
The New Streamlined SBA EIDL Loan Application Review
After July 1, 2021, the SBA streamlined the loan review process. Multiple steps in the procedures were removed, which greatly quickened the pace loan officers could proceed. In addition to decreasing the number of steps, the SBA made two changes that skyrocketed their approval pace.
First, they removed the phone call requirement. Previously, officers had to call each applicant at least once (one introductory phone call and another to ascertain more information, if necessary). Now, there is no introductory phone call and the loan officer sends an email if they need more information.
Secondly, the SBA cut the response window for applicants. Previously, applicants had a full week to respond to a loan officer's request for more information. Now, applicants only have three days to respond to the email. If no response is made within three days, the loan is put into a "withdrawn" status but is not denied.
With this new process, loan officers can now complete 5 per hour, up to 35 per day. In addition to these changes, the SBA moved the EIDL program from the Office of Disaster Assistance to the Office of Capital Access and prioritized personnel for the EIDL. All of these changes resulted in the SBA increasing its processing rate from less than 2,000 applications per day to nearly 40,000 per day.
Conclusion: EIDL Loans Are Moving Fast Thanks to New SBA Loan Reviews
Thanks to all of these modifications, EIDL applicants should receive an answer in the coming weeks. The SBA predicts that the backlog should be cleared by mid-August. If they continue to process 37K-40K applications per day, they just might do so.
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