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West Palm Beach Bankruptcy & Business Attorneys > > Business > Renewing a Hardship Accommodation on an SBA EIDL Loan

Renewing a Hardship Accommodation on an SBA EIDL Loan


Did your business receive a loan from the US Small Business Administration (SBA) during the pandemic, and are you currently struggling with the terms of repayment? For many South Florida businesses that received SBA loans, and loans through the Economic Injury Disaster Loan (EIDL) program specifically, there are no existing pathways for forgiveness through the SBA as there are with certain paycheck protection program (PPP) loans. As such, a range of small businesses with EIDL loans took advantage of the SBA’s Hardship Accommodation Plan when it first became available.

The SBA clarifies that its Hardship Accommodation Plan, or HAP, is potentially available to COVID-19 EIDL borrowers who are “experiencing short-term financial challenges.” The SBA explains that borrowers that are eligible can pay just 10 percent of their agreed-upon payment for a six-month period, and they do not need to catch up on any missed payments first. The detailed information also says that “borrowers will have the option to renew after the plan concludes.” If you have already applied for and received a hardship accommodation in the past and need to renew, what do you need to know?

Understanding Recent Extension Options for Renewals 

If you are able to renew, what can you expect in terms of a hardship accommodation? As you already know, the first hardship accommodation allows a business to pay 10 percent of the monthly loan payment it owes for a six-month period. Upon renewal or reenrollment, a business can be eligible for:

  • 10 percent of its payment for the second six-month period;
  • 50 percent of its payment for the third six-month period; and
  • 75 percent of its payment for the fourth six-month period.

The amount you will be required to pay upon renewal or reenrollment will depend on your history in the Hardship Accommodation Plan. The SBA recently announced these options above, so it is important to move quickly if you want to benefit.

Eligibility for Reenrollment in the Hardship Accommodation Plan 

A wide range of businesses can be eligible, even if they are in default on their EIDL loan currently — as long as the loan has not already “been sent to the Treasury for extra collection steps,” according to the SBA, which usually happens when a business is 180 days late or more.

Seeking Legal Assistance As Soon As Possible 

If you want to renew or reenroll in the SBA’s Hardship Accommodation Plan, it is important to seek legal help to do so. The process can be complicated, and given the importance of a reduced payment for your business’s financial health, it is essential to have an experienced advisor assisting you.

Contact a West Palm Beach Business Law Attorney Today 

If your business has questions about applying for an initial EIDL hardship accommodation or renewing a hardship accommodation, one of the experienced West Palm Beach business lawyers at Kelley Kaplan & Eller, PLLC can begin working with you today. We have extensive experience assisting businesses with issues related to SBA loans, and we can help you to seek the accommodation you need. Contact us to learn more about the services we provide to small businesses in South Florida.



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