If you’ve heard people talking about money from EIDLs (pronounced idle), they’re referring to Economic Injury Disaster Loans. And, yes, EIDLs for freelancers are a real thing, at least in theory.

What is an EIDL?

An EIDL is a loan designed to help small businesses that face temporary difficulties because they lost revenue as a result of COVID-19.

The Small Business Association runs the program, and it’s open to any business with less than 500 employees, including sole proprietorships, independent contractors and self-employed individuals.

How Much Help Do EIDLs for Freelancers Offer?

The EIDL program is supposed to offer loans up to $2 million. And while you’re waiting for a loan, you’re supposed to be able to get a $10,000 loan advance.

That advance should be available within days of a successful application, and you don’t have to pay it back.

Program terms vs. reality

I’m telling you what should happen with an EIDL because, as I wrote about the Payroll Protection Program, this is a federal government effort, and having high expectations that it would roll out like it should is just foolish.

For starters, small businesses don’t appear to be getting anything close to $2 million from EIDLs, Politico reported.

Applicants will likely be given a maximum of $25,000-$35,000, an email from Tom Sullivan, the U.S. Chamber of Commerce’s vice president for small business policy revealed.

Senator Ben Cardin, moved the peg lower and said the loan program was “only able to provide $15,000” to small businesses, even though the average amount requested was $200,000.

Cardin also said the program doesn’t have enough money to give every business the $10,000 advance.

It seems the EIDL program is underfunded.

By early April, businesses had reportedly applied for $372 billion worth of EIDLs but only $7.3 billion had been authorized, Politico said.

What are the loan terms?

The interest rate on EIDLs can’t exceed 4% and borrowers can get up to 30 years to pay them back.

Ultimately, the exact terms are determined by your ability to repay the loan, an SBA info page says.

So, what is lost revenue?

As I said, these loans are for people who lost revenue. If you contracted the coronavirus and couldn’t complete scheduled work, that is a straightforward loss.

But you don’t have to get sick. You can claim to have losses related to COVID-19 if, for example, you’re a sportswriter but all of the sporting events are canceled, or you’re a travel blogger and your tourism clients canceled upcoming projects.

The list goes on.

But remember, you don’t necessarily need to lose all of your future work or income. You just need to be impacted.

Should you apply for an EIDL?

Even if you can’t get as much as you want, receiving $10,000 you don’t have to repay and another $15,000 to $20,000 that you’ll pay back over several decades could be a big help to a lot of freelancers.

If you think you’ll qualify, it could be worth pursuing. On average, it takes 2 hours and 10 minutes to complete the application.

Currently, the application is showing an expiration date of September 30 but given the demand and threat of inadequate funding for everyone, you shouldn’t wait any longer than necessary.

Also, if you’re in  or headed toward financial trouble, don’t sit back and wait on this or any other program. Explore your options.