SBA’s EIDL Loan Modification Processing Time Warp

With the PPP wrapped up, some would say too soon, I included … the SBA recently expanded the EIDL loan program by redoing the loan limits math.

SBA Loan Limits Increased … But Not Funded

Originally the loan was to provide revenue replacement for 6 months but as COVID19 has dragged on longer than that, SBA extended the loan limits to two years of revenue. This limit has a cap of $500,000 compared to the original cap of $150,000.


The EIDL is a program run directly by SBA, unlike the PPP which had small businesses seeking grants through third party banks. The processing demands of EIDL therefore have to be much greater and it seems to show on the processing times. Ultimate SEO LLC was a recipient of an EIDL loan in 2020 and applied for the increase when it was first announced, three months ago. The process has been frustrating to say the least.


Originally applicants had to respond to an email for the increase. Some three or so months later, I logged into the EIDL loan portal and noticed a button there that allowed me to select a new limit using a slider. I wasn’t directed to the portal by followup emails but just stumbled upon it. 


 I assume the email unlocked this ability but I have no knowledge of the use of the original email.

After filling out the modification application, we’re asked to sit back and be patient. Turning in the FORM-4506-T became the next pivotal step. 


 The SBA was seeking IRS transcripts for previous years, I assume to prevent fraud but it seems this step has cost businesses months of time. In articles others have posted that the IRS has been slower than preferable in completing these requests. 


 By slower, I mean months…but SBA hasn’t been all that stellar on its own with the 4506-T, I ended up submitting it, then resubmitting it only to be asked to submit it a third time.


SBA EIDL Fraud Risks Not Considered


In this limbo of sorts a unique fraud issues has also arisen. Part of the SBA’s process involves pulling the credit of applicants, which they already did when they awarded the EIDL, which has required small business owners to ensure their credit reports are not locked and therefore open for anyone else to pull as well. That is an unintended fraud risk left on small business owners like myself.


You see, normally my credit file is locked and no one can read my credit unless I unlock it…which prevents others from using my credit for fraud purposes. But in order for the SBA to read my credit, I’ve now had it unlocked for months without any attempted pull on the report by the SBA. I assume they are awaiting tax transcripts still and the credit pull is a later step. 


 While SBA is awaiting tax information from the IRS it would be beneficial for SBA to go ahead and pull the credit reports making better use of their time and decreasing the amount of time a small business owner has to leave their credit unlocked.


SBA Processing But No One’s Home


Suggestions, questions and explaining the impact of SBA’s decisions is next to impossible to offer the agency. I have called them with questions and been told everything was fine and just be patient. 


 I noted though to the agent I hadn’t even provided my loan number to him so how could he know that about my loan modification? He had said he didn’t even have access to the loan applications. So while the phone calls are getting answered in under ten minutes its by agents who lack any power and simply are there to stonewall callers.


Sending an email with my specific concerns and questions earned me a similar response from SBA to be patient. While the reply was made within 48 hrs it still lacked any substance or knowledge on the process. Faith is something God expects from us but now it seems the SBA requests it as well.


I had luckily spoken with a loan officer before the modification so I went ahead and emailed her directly. This provided the greatest insight in the last 3 months. The loan officer said she lacked the ability to do anything and wasn’t assigned to loan modifications, but that she could see that my application was received and that it was still pending assignment to a loan officer. 


Thats three months of sitting cold on the shelf waiting for someone to even glance over it.

The SBA has said its added loan officers but it may be time to consider fast tracking some of the hurdles self imposed by the SBA. If it takes them the entire time frame originally allotted to the loan duration ( 6 months ) to process a loan now … then the value of the help is really diminished.


 Consider, if the aid is needed … and these businesses truely need capital to remain functioning …. then how long are we thinking they can be functional without it while were processing?

Ultimately SBA and EIDLs are a lifeline and I’m sure the businesses that are around still after the processing will benefit greatly from the aid. Which…is just a loan and has interest so … not like the PPP.


SBA PPP Leaves Out Small Businesses


It is sad that a program meant for good, could be so mismanaged that its largely questionable how much actually went to real small businesses. The program closed with hundreds of thousands of applicants still seeking funds.


PPP Fraud?


Now these examples I’m not saying are fraud, I’m just saying they smell a lot like fraud.

I did a test and looked up the largest PPP loans given in my zipcode. It took me 3 minutes to find a loan that I think is questionable.



Roman Catholic Bishop Of Louisville, A Corporation Sole DBA – received $316,000 in PPP money from the SBA.
Since when has the Roman Catholic Church been a small business?   Id suggest that it was already too big when Jesus died.  If we want to only consider the small office of the Bishop, it should still be a franchise of the conglomerate. Every priest, lay person, catholic hospitals that report to the Bishop should then therefore count as well as staff. But in this loan they claim a staff of 64 people. (Not that small already)

Thats like me running Hewlett Packard but claiming each floor and each desk on that floor is an independent business and therefore a small one. Just to the tune of something like 50,000 small businesses. Thats sad….that God claimed to be a small business.


James Marshall is a roofing contractor according to it’s PPP application and a corporation with 18 employees. This small business received $125,600. Now heres the issue … shows no corporation has ever existed in the state of Kentucky by that name, or any name similar. A Google search of that name and roofing yields no business website or listing at all. No BBB profile … no customer reviews ever. If it was a corporation it should have required LLC, Corp, Inc or something in its name. When pulling up the address listed on the application in Google Maps, the business name on the sign hanging on the building is a different company altogether. But PNC Bank somehow knew that this was a small business in need of over a grand!


So PPP is likely ripe with hundreds of billions going to fake businesses and it can take all of 5 minutes and soime common sense to see these two above really aren’t the mom and papa shops that PPP was meant to save.


Louisville Metro COVID Relief Grants: COVID Grants That Cost More Than They Gave


I landed a grant from the city of Louisville during COVID, I was really excited about it. I thought it would give me the ability to work on my site and basically be my own client for sometime. The grant was a night-mere … still is actually … you see they required all grant funds to be spent before a specific date they had set arbitrarily …. and then they took months … beyond that date before they released the funds! 


 So I was contractually obligated to spend and pay for an expensive project that I didn’t have the money for in order to get the money several months later. Only I was promised the funds beforehand …. so once I started it all seemed to make sense, until I was facing tens of thousands of dollars in expenses that weren’t being reimbursed as promised, all the while buried under reporting requirements that took weeks on their own to complete. Only to receive the money after the deadline to spend it!


Arguably that grant wasting resources, forced me to break promises and robbed funds from other projects … while requiring so much attention from me. For instance … if I supply an invoice from a Cloud Computing Host that shows an amount billed and notes a payment … even referencing the payment method. 


 Why then did I end up having to dig up records of the bank statement for the payment and even then sometimes having to request the vendor write a statement that I paid them only to have the auditor contact that vendor afterwards to verify that I paid them. It was ridiculous.


I felt and remain in this camp … that if the grant money is to help the business it shouldn’t hurt the business….draining funds that it doesn’t have to begin with. And that if the grant maker can’t pay the grantee before the grant period ends, then the grant period just has to be extended in order to not place undo stress on the business.


Anyhow, this was a tangent …. but thanks Louisville Metro government for having me start an ambitious project and then leaving my hanging well into the new year.

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