Financial Matters Miscellaneous

Recovering lost rental income revenue due to COVID-19

Written by Joan Talmadge
3.1/5 - (7 votes)

UPDATE April 29, 2020, from the SBA site: “Notice: Lapse in Appropriations. SBA is unable to accept new applications at this time for the Economic Injury Disaster Loan (EIDL)-COVID-19 related assistance program (including EIDL Advances) based on available appropriations funding. Applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis.”  We will continue to monitor the SBA site and provide updates as they become available. But for now, it appears that it’s not possible to apply.

We are closely monitoring how COVID-19 is impacting the Cape and Islands vacation rental industry and our homeowners. Although things are constantly changing, we wanted to share some information we’ve been able to gather with regard to the CARES Act.

Rental property owners MAY be able to recover some lost rental income revenue through either the EIDL (Economic Injury Disaster Loan) or the PPP (Paycheck Protection Program) portions of the CARES Act, administered by the Small Business Administration (SBA).

It is our understanding that a portion of the EIDL loan is likely to be forgiven by the SBA (up to $10,000). These loans are not tied to a bank (like the PPP program is), but instead are applied for directly on the SBA site.  Your eligibility may depend upon how you’ve organized your rental business to take in rental income (e.g., if you are a sole proprietorship, etc.).

How and where to apply

Earlier, we reported: If you are interested in applying for the EIDL loan, go to the application on the SBA site:  You’ll see that on the second page of the application, there is a line for “Rental Properties (Residential and Commercial) Only – Lost Rents Due to the Disaster.” In the meantime, however, that link has become invalid.  You can try the SBA site  to see if it’s been updated, the application process has been resumed, and the funds have been replenished.

For more information regarding the PPP, it’s best to check with your bank to see if you are eligible.

Time may be of the essence

One other thing we’ve heard from multiple sources is that EIDL funds will be granted on a first-come, first-served basis.  If vacation homeowners wait until summer, there is a strong likelihood that there will no longer be any funds available.

If you already have cancellations due to the coronavirus, it may behoove you to apply now (if you can), even if later it turns out you don’t need the funds because you were eventually able to rebook your home.  And if you haven’t had any cancellations yet, you can still apply as there is no prepayment penalty on this loan.  Therefore, you can simply return the funds later – although there may be a very small amount of interest due for the months you held the money.

If you are able to get any funds from either of these programs, we’d love to hear about your experience or any tips you can offer other homeowners.

About the author

Joan Talmadge

Joan Talmadge - My husband Jeff and I created in 1997, shortly after buying our Cape home. My background includes teaching fifth grade for 8 years and writing and editing educational publications for 15. I get great joy from helping fellow homeowners successfully rent their homes. Jeff and I are proud to have two of our three grown children working for, truly a family-run business. For me, the Cape and Islands are magical all times of the year -- whether it's walking on Nauset Beach, playing golf, or enjoying family and friends. Email Joan


  • Hello Joan,
    May 18, 2020.
    Do you know if Massachusetts is allowing vacation rentals is of today? The website is unclear. It indicates they are thinking about it before Phase 2 begins. That’s not to helpful if you have potential tenants wanting to rent now. Also, that translates into no rent for the property owner.
    Thank you for your thoughts.

  • we have a rental property in florida and had to cancel short term rentals due to governor’s order and not sure how much longer it will continue–I just got an email from the county stating that the sba is now taking applications for short term rentals and to fill out the application but not sure if we are considered “business with under 500 employees”, or sole proprietorship or independent contractor? and do we just fill out the “rental part” on page 2 or or do we have to fill out the whole page starting with “business name”?

    • Well, that sounds encouraging at least! Sorry, but we have no ability to provide you with any insights about the application process. Have you tried to contact the SBA directly?

  • the application process has been shut down since Monday – i haven’t seen anything in the news about taking more applications. Any other info on this?

    • Hi, Candy, we have just updated this post a bit. Things literally change from day to day. But you might try checking with the SBA site (linked above) intermittently to see if they are, once again, accepting applications. And also, try checking with your bank about the PPP option.

  • I just tried to follow the link provided in this thread. They are no longer accepting applications. There is no application form or related information on that area of the site either. I suspect the $$$ has run out?

    • Hi, Bernie, yes, sorry. We believe more money has been made available, but the SBA seems to be having issues with their site as well. We suggest trying again intermittently to see if things improve.

  • Hi. I called the helpline that was listed for the SBA loan and they didn’t have any answers to my questions. So my question is if you have more than one rental do you file for a separate loan for each rental property or one loan for all of the properties?

    • Boy, Terry, if the SBA loan group don’t know the answer to your question, we sure don’t. If I had to hazard a guess, though, I would think you’d apply for one loan for the properties combined. You might try calling SBA again and perhaps you’ll get someone who can provide the answer.

  • I think you can only apply for the EIDL program if you are set up as a rental business rather than owning an investment rental property that you only rent for 10 -12 weeks a year. I heard or ready something about it being determined by whether or not you file a schedule C vs schedule E on your property. If anyone has any clarifications, please feel free to chime in. Thank you.