I was denied for EIDL SBA loan and was notified by an email. Not eligible due to character reasons.
I have 90 days to request for reconsideration, what should I submit and what is the effective way to dispute it?

By Murray Wennerlund published 10-5-2022 updated 11-10-2022

Character reasons. Applicants may be declined if they have been convicted of a felony in the past five years or ever been engaged in the production or distribution of any product or service that has been determined to be obscene by a court of competent jurisdiction those who are currently suspended or debarred from contracting with the federal government or receiving federal grants or loans and/or those who are presently subject to an indictment, criminal information, arraignment, or other means by which formal criminal charges are brought in any jurisdiction.

You can follow the reconsideration process we offer and provide evidence by official documents you have no adverse conditions that would make you ineligible for a loan. 

You may need to do a criminal background check on yourself. You can call your local Sheriffs office and ask them if you have any open items, outstanding warrants or notices that you might have forgotten about. You can also do a work history report to find any issues your current employer or past employers are experiencing. You can also request from local courts a declaration of moral character. This is typically used when you move for work in a foreign country.

  • Check with your local courts and law enforcement for legal issues. 
  • Employment check to make sure your current or past employers are not on a blacklist.
  • Check if you or your company or the company you work for has been denied bidding rights to government contracts. 

Supply all documents from as many agencies as you can for your reconsideration or appeal.

Editors Note 11-10-2022: I just finished listening to PBS NewsHour West live episode, November 10, 2022 linked here to YouTube.Com and one of the subjects (topics) was about SBA loans being declined because of a criminal record. This is true, and your denied application will have this reason code. You can attempt to appeal but I would recommend that you contact your states Housing Commission which is funded by HUD Community Development Block Grants for any temporary housing assistance from rental, mortgage to motel and apartment lodging. You will also apply to your states CDBG-DR grant program which is managed by your same agency that manages the HUD CDBG funds. If not, it will be a department associated with the same. You will not run into any issues of your work or criminal history with HUD Grants and you could save yourself extra debt that would have to be paid back if you were approved for an SBA loan.