Comparison of SBA 7a, SBA Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL)

Program Feature	Regular SBA 7a	PPP Loans	EIDL
Lender	A bank	A bank (and maybe other online lenders TBD)	Direct to the SBA
Eligibility	(1) The size of the applicant alone (without affiliates) must not exceed the size standard designated for the industry in which the applicant is primarily engaged; and (2) The size of the applicant combined with its affiliates must not exceed the size standard designated for either the primary industry of the applicant alone or the primary industry of the applicant and its affiliates, whichever is higher.	(1) Any company with not more than 500 employees is eligible without accounting for affiliates. (2) Applicant must have been in operation on February 15, 2020, and have employees for whom the applicant paid salaries and payroll taxes.	(1) Any company with not more than 500 employees is eligible without accounting for affiliates. (2) Business must have sustained economic injury and be located in a disaster declared county or contiguous county.
Maximum Loan Amount	Up to $5,000,000 if guaranteed by the SBA (75%).	The lesser of (1) $10,000,000 and (2) the average monthly amount paid by the applicant for payroll obligations incurred during the one-year period before the date on which the loan is made multiplied by 2,5 times. Salaried employees receiving compensation greater than $100,000 per year will not be included in the eligible loan – specifically amount calculation for amounts over $100,000	Up to $2,000,000. The SBA determines the loan amount. The assumption is that the loan amount will be directly correlated the business’ gross profit margin.
Eligible Use of Loan Proceeds	Any business use including but not limited to working capital, M & E, real estate, business acquisition and expansion and business debt refinance.	Payroll costs; related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums. Employee salaries, commissions, or similar compensations limited to employees compensated less than $100,000 per year. Payments of interest on any mortgage obligation (which shall not include any prepayment of or payment of principal on a mortgage obligation). Rent (including rent under a lease agreement); Utilities Interest on any other debt obligations that were incurred before 2/15/20	Financial obligations and operating expenses that could have been met had the disaster not occurred.
Term and Amortization	10 year term and amortization for non-real estate loans. 25 year term and amortization for real estate loans.	Maximum term of 10 years	Maximum term of 30 years
Repayment Terms	Payments, either principal and interest or interest only, commence the first month after the loan is funded.	Requires lenders to provide complete payment deferment relief for not less than 6 months and not more than 1 year after the loan is funded.	Payments start one year after the loan is made. Interest is accrued during the deferment period.
Interest Rate	No greater than WSJ Prime plus 2.75%	Not to exceed 1 %	3.75% for businesses 2.75% for not for profits
SBA Fees	Up to 3.75% of the SBA guaranteed portion of the loan amount.	Waived	Waived
Personal Guarantee	Personal guarantees are required from all individual owners with a 20% or greater ownership interest.	Waived	Personal guarantees are required from all individual owners with a 20% or greater ownership interest.
Collateral	All available collateral at the entity level is required to be pledged until a 1:1 collateral coverage is achieved. Additional collateral, if available, from personal guarantors will be required if a 1:1 collateral coverage is not achieved at the entity level. Insufficient collateral coverage is not a reason to deny the loan.	Waived	The SBA will place a UCC lien against the assets of the business.
Loan Forgiveness	None. The SBA and the lender share pro rata in the liquidation of any collateral.	The portion of the loan associated with maintaining payroll continuity during the period February 15, 2020, to June 30, 2020, (the covered period) may be forgiven. The amount of loan forgiveness will be reduced to the extent that the number of full-time equivalent employees during the covered period is less than the number during the period from March 1, 2019, to June 30, 2019, determined by calculating the average number of employees for each pay period falling within a month. Employees can be rehired to get this loan forgiven	None. Historically there has not been any debt forgiveness component to these loans, however the SBA can make changes to this policy at any time.