EIDL Subordinations: The Long and Short of It

We’re coming to the point in time when banks will be looking to exit companies propped up by government-sponsored stimulus money and programs (PPP and EIDL). While PPP money poses no issue, EIDL clients require an extra step in the exiting process; one that could potentially add time to their exit.

Originally, EIDL paperwork was arduous and not standard from office to office. It could take months for an EIDL to be subordinated. The process has improved significantly (possibly a result of SFNet’s lobbying efforts) in that when the forms (now standardized) are completed correctly, an EIDL can be subordinated in as little as one week. (Key words: “completed correctly”).

When looking to exit an EIDL client, bankers who inquire and make sure the potential new lender understands the process and has experience and expertise in EIDL subordinations can save themselves a lot of time and needless headaches.

Celtic Capital has successfully facilitated numerous EIDL subordinations. We’re happy to help bankers who have an EIDL client they need to quickly and easily exit.

About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for the more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset based financing solutions from $500,000 to $5 million with no financial covenants.

As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.

If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.