How to Apply for a Small Business Loan in Illinois


As the COVID-9 crisis continues to rumble on, we’re all starting to feel the pinch… some harder than others. For small businesses in badly hit states like Illinois, the effects of the lockdown have been devasting, with many scrambling to keep up with outgoing expenses as their incoming revenue falls ever lower. In response to the situation, measures have been put in place on both a federal and state level to assist.

Passed by Congress on March 27, the Coronavirus Aid, Relief, and Economic Security (CARES) Act includes two small business loans, the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL), intended to provide a cash injection to businesses suffering temporary revenue loss as a result of the crisis. Businesses may apply for both the EIDL and PPP in conjunction, but the loans cannot then be used for the same purpose. In Illinois itself, DCEO and the Illinois Department of Financial and Professional Regulation (IDFPR) have launched the Illinois Small Business Emergency Loan Fund to provide low-interest loans of up to $50,000. If you’re a small business owner struggling to keep up with payroll or operating expenses, the loans could be a lifeline. Here’s how to apply for a small business loan on Illinois.

Illinois Small Business Emergency Loan Fund

The Illinois Small Business Emergency Loan Fund is a new initiative established by DCEO and the Illinois Department of Financial and Professional Regulation (IDFPR) to offer small businesses in Illinois low-interest loans of up to $50,000. Strict eligibility requirements apply, but as it stands, any business located outside of the City of Chicago that employs no more than 50 workers, generated less than $3 million in revenue in 2019, and have suffered at least a 25% decrease in revenue as a result of COVID-19 will be able to apply. As per the directives on the state website, at least 50% of the loan must be used for payroll or other compensation types, including salaries, wages, tips, paid leave, and group healthcare benefits.

How to Apply

Applications should be made directly through approved lenders. An expression of interest should be made via the state website, and the DCEO will then connect the business with lenders.

The Economic Injury Disaster Loan (EIDL)

The Economic Injury Disaster Loan (EIDL) program offers small businesses the opportunity to apply for loans of up to a maximum of $2 million. The intent of the loan is to support businesses suffering a temporary loss of revenue as a result of the COVID-19 crisis and is intended for use against operating costs such as mortgage payments, rent, and utilities, in addition to payroll expenses such as compensation, salaries, healthcare and retirement benefits, and severance pay.

The loan is limited to businesses that fall into the following categories:

  • Small businesses employing less than 500 workers
  • Businesses with 500 + workers who are classed as ‘small’ according to SBA’s Size Standards
  • Independent contractors and sole proprietors
  • 501 Veteran organizations
  • Cooperatives
  • Private non-profits
  • Tribal small businesses
  • Regardless of type, the business will need to have been in operation since at least January 31, 2020.
  • Loans are offered on preferential terms to include the following:
  • The option to defer payment for up to 4 years
  • A fixed interest rate of 3.75% for businesses and 2.75% for non-profits
  • 30-year loan terms
  • A forgivable advance of $10,000
  • No requirement for a personal guarantee on loans of up to $200,000
  • No requirement for collateral on loans of up to $25,000

How To Apply

All Economic Injury Disaster Loan applications are administered directly by the SBA and need to be filed directly at the SBA website. During the application, you’ll be asked to verify your eligibility, and confirm certain information relating to the business, its activities, and its ownership.

  • Step 1: In step one of the application, you’ll need to complete a declaration asserting that your business fulfills the eligibility criteria.
  • Step 2: Once you’ve completed the declaration, you’ll be prompted to supply information relating to the nature of the business. This will include the legal and trading name of the business, SSN or EIN number, gross revenue for the year ending Jan 31, 2020, and number of employees.
  • Step 3: The next step will ask you to confirm details relating to the ownership of the business. If the business is partially owned by another entity, they’ll need to provide a signed loan guarantee.
  • Step 4: If the business has any criminal history, you’ll need to confirm the details.
  • Step 5: As the final step before submission, you’ll be asked if you’d like to take a $10,000 advance on the loan, payable within 3 days of the loan being accepted. The advance is paid in the form of a grant and will not need to be re-paid with the remainder of the loan.

The Lowdown

Administered by the SBA, the Paycheck Protection Program (PPP) provides immediate assistance to small businesses that have experienced a loss of revenue as a result of the COVID-19 crisis. The loan is intended to allow businesses to retain their staff by supporting with payroll, including commissions, salaries, and other forms of compensation, as well as operating costs.

  • The maximum loan that can be drawn is $10 million, with up to $100,000 paid per covered employee. Chief points of interest include:
  • Loan forgiveness if at least 75% of the loan is used for payroll and covered employees are retained for at least 8 weeks after the loan origination date
  • 2-year loan terms
  • No SBA fees, and no requirement to provide a personal guarantee
  • A fixed interest rate of 1%

How To Apply

Unlike the EIDL, the Paycheck Protection Program utilizes approved lenders to administer the loans. To apply, you will need to complete the SBA Paycheck Protection Program loan application form, and submit directly to a participating SBA 7(a) lender, federally insured depository institution, federally insured credit union, or Farm Credit System institution. A full list of participating lenders in Illinois can be found at As Forbes notes, it’s important to choose your lender wisely: for the greatest chances of your application being processed in a timely manner, ask the lender what percentage of loan applications have been funded. Ideally, the answer should be around 100% within 10 days of application receipt.

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