Express Bridge Loan Pilot (EBL) Program

On March 25, 2020, the SBA announced that its Express Bridge Loan Pilot Program (“EBL Program”) is being expanded to cover the COVID-19 pandemic. The EBL Pilot Program is designed to supplement the Agency’s direct disaster loan capabilities. As originally announced, the EBL Pilot Program authorizes SBA Express Lenders to provide expedited SBA-guaranteed bridge loan financing on an emergency basis in amounts up to $25,000 for disaster-related purposes to small businesses located in communities affected by Presidentially-declared disasters while those small businesses apply for and await long-term financing (including through SBA’s direct Disaster Loan Program, if eligible). All of Louisiana is currently in a Presidentially-declared disaster zone and so businesses located in Louisiana meet this requirement.  

As the name “bridge loan” implies, the loans offered through this program are emergency loans designed to bridge the gap for businesses needing emergency funds while they wait for long-term financing. This includes businesses waiting for traditional long-term SBA loans. This also includes businesses awaiting Economic Injury Disaster Loans (“EIDL”) from the SBA under the new Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Typically, eligibility for an express bridge loan will follow the eligibility requirements for a traditional SBA disaster loan, but the process of applying for and receiving loan funds is expedited. 

As with all 7(a) loans, EBL applicants must: 

• Not be eligible for credit elsewhere
• Be located in Presidentially-Declared Disaster Location
• Be suffering from adverse impact from COVID-19
• Apply within 6 months from the President’s declaration

The maximum loan amount is $25,000 and the maximum loan term is 7 (seven) years. The lender may require the bridge loan borrower to pay the bridge loan in part or in full if/when the borrower is approved for long-term disaster financing. Under SBA guidance, the first disbursement of the EBL loan proceeds should occur within 45 days of the lender’s receipt of an SBA loan number. The EBL can be repaid in full or in part by proceeds of the small business’ EIDL. 

For complete eligibility and program information, please visit this link with the full rules and eligibility requirements.