SBA Disaster Loan Instructions & Tips

Tips and Considerations for small businesses applying for an SBA disaster loan.

 Small businesses are eligible for up to $2 million in Economic Injury Disaster Loans from the Small Business Administration (SBA). President Trump has called for an additional $50 billion in funding to the SBA’s lending program from Congress. While the $50 billion has not yet been approved, the SBA is able to issue an Economic Injury Disaster Loan declaration thanks to the Coronavirus Preparedness and Response Supplemental Appropriations Act. Note that this program is NOT the same as the Paycheck Protection Program(PPP), which is part of the CARES Act.   Although businesses could possibly qualify for funding under both loan programs, the PPP should be considered prior to moving forward with the Economic Injury Disaster Loan, as it contains a tax-free  loan forgiveness feature and does not require personal guarantees.  

 Knowing what to expect before starting the loan process will help prevent unnecessary errors and rework. Completing the application process quickly and accurately will be key as there will be high demand and processing times will likely increase. We’ve put together the following summary of what business owners can expect when applying for an SBA loan.  

 Before you get started, you will want to:

 Determine eligibility. 

Remember, your business must be located in an SBA-declared disaster area to be eligible for the SBA Disaster Loan. To find out if your state is an SBA-declared disaster area visit:

 Gather the required documents. You will need:

  1. Completed SBA Form 5 (See step 3 below)
  2. Signed IRS Form 4506-T 
  3. Copies of your most recent federal income tax returns for the business
    1. If you have no yet prepared 2019, you can provide 2018
  4. The last three year’s Profit and Loss Statements 
  5. Owner’s Personal Financial Statement 7(a)/504 Loans and Security Bonds 
    1. Each owner included on SBA Form 5 will need to provide a personal financial statement. This step can be time consuming if there are above average real estate holdings, investments or complex liabilities to report.
  6. Schedule of Liabilities 
  7. Completion of truthful information certification in the form of an e-signature

 A disaster assistance loan officer may also request you to fill out additional forms such as a fee disclosure form and compensation agreement.

 Set your expectations.

  • Set aside at least 2 hours to complete the application. It is ideal to complete this application in one-sitting. Due to high volume, pages can often take 30-45 seconds to load. If you receive an error message, try refreshing pages or navigating backwards.
  • At times during the process, it may be advantageous to have two web-browsers ready. For example, there have been reports of the e-signature portion not functioning properly on Google Chrome.

 Step 1: Register your business.

Register your business here: 

This is a simple step that will require you to input basic information including your date of birth, social security number and business address. Whomever completes this step must have the authority to sign documents and request tax transcripts.  

 Step 2: Begin the application.

Navigate to and select ‘Apply Online’.

 Step 3:

Download the ‘business Loan Application (Form 5)’.

 Step 4:

Complete the application.

 Step 5:

Upload your completed application and supporting documents by dragging and dropping them into the ‘upload your documents’ section of the online application. There is also an option to mail the required documents. It is essential to sign and date all forms as incomplete applications will not be accepted. 

 Step 6:

Stand by, ready for questions. From the time the application is submitted, approval can take several weeks. During this time be available for additional follow-up questions in the event more documentation is required. The entire process from application to funding generally takes 30 to 90 days.

We have heard reports that after submitting the application process online, applicants have received an email acknowledgement that their application was received. 

There are three ways in which you can monitor your application status: by phone, online or email.

 At Darnall, Sikes & Frederick, we are available to provide guidance and assistance with your SBA loan application.