ICBA posted a new guide to Small Business Administration lien requirements on Economic Injury Disaster Loans after seeking SBA input on its treatment of EIDLs.
The guide notes that EIDL loans over $25,000 require a blanket Universal Commercial Code lien allowing the SBA to take an interest in the assets of the business. It also says the SBA does not prohibit lenders with a superior lien position to the UCC-1 lien to continue advancing additional funds under existing borrowing arrangements.
The guide also provides SBA contact information for borrowers and lenders seeking consent for subordination, and it links to additional EIDL resources from SBA.
Additional information on the federal pandemic response are available in ICBA's frequently asked questions on COVID-19. View the EIDL guide.